Detroit Dilemma

A few good strikes can create as much unemployment in a day as NRA can cure in a month. Last week one of the "best" possible strikes for creating unemployment threatened to halt the progress of U. S: Recovery. First scheduled for the factories of Buick. Hudson and Fisher Body, the prospective strike was capable of engulfing the entire automobile industry.

Two things made the strike threat dangerous as dynamite: (1) The American Federation of Labor has set its heart on unionizing a great open-shop motor industry. With automobile manufacturers heading into their best season in years, and profits definitely in sight. Labor's bargaining position was all but ideal. Now if ever the automobile companies could be forced to recognize the A. F. of L. under pain of strike at the peak of production. (2) No less firmly braced were the heads of the automobile industry against allowing their business, whatever the cost, to fall into the clutches of organized labor. With them, too, it was now or never to stand and fight the A. F. of L. Left to themselves both sides would certainly have forced a showdown, for each was fighting for a huge stake. But a third party also had a huge stake in the struggle. For the Administration a shut-down of the automobile industry, its prize child of Recovery, would be a severe blow. The strike question therefore became a three-cornered battle in which the Administration might give aid and comfort to either side provided a showdown could be pre vented. Fortnight ago here was a preliminary skirmish when the A. F. of L. Automobile Workers' Union demanded a 20% wage increase and recognition. Last week the opening gun of the battle was fired by the National Automobile Chamber of Com merce. After a two-day session in Detroit the Chamber issued a manifesto declaring that, in spite of the fact that hourly wages are as high as in 1929, that weekly earnings are 90% as high and living costs only 83% as high, it would advise its members to cut hours from 40 to 36 a week and raise wages to make up the difference. The Chamber includes the whole industry ex cept Ford. While it was in session Ford announced that it would restore its famed $5 per day minimum for all workers. Thus did the entire industry court favor with the Administration by payroll increases. Day after this first move, Senator Wagner's National Labor Board opened strike hearings in Washington. The heads of the A. F. of L. automobile union appeared with evidence to prove that Hudson. Buick and Fisher Body had discharged men who joined A. F. of L. unions, had herded workers into company unions. They demanded shop elections under Labor Board auspices for workers to choose their own unions. The Labor Board heard them with much sympathy. Only that morning Senator Wagner had appeared before a Senate Committee to advocate passage of his Labor Disputes Bill which would practically outlaw company unions (TiME, March 19). Next day William S. Knudsen. General Motors' executive vice president, and Abraham E. Barit. Hudson's executive vice president, appeared. Each offered a cold, formal statement and turned his back on the committee. Mr. Knudsen's statement: "In the fall of 1933. employe plans of representation were adopted in practically all of our plants, including Buick. Not only were they the free choice of our employes but on the average they were adopted by a vote of over 80% of all employes. These plans provide for works councils who are authorized to bargain collectively on behalf of the employes assenting to the plan. Through such works councils all disputes have been amicably settled where direct negotiation has been resorted to. -'We are prepared, so far as we legitimately can. to see to it that no group of employes, not even a single employe, shall be coerced into being represented by any works council, labor union or outside representation, not of their own choosing. P:"We are ready to bargain directly with the duly accredited representatives of any of our employes. But the authority to represent must be shown. P:"We have no right to bargain with the Labor Board in respect to how our employes may choose to be represented and must decline to make any commitment or accept any obligation with respect to any election that may be resorted to. P:"We are willing upon proof of the authority of [the A. F. of L] Union to negotiate for specified employes, to meet with their representatives and discuss questions of hours of employment and wages, together with systems of payment. We are not, however, willing to recognize said Union as such, nor to enter into any contract with it on behalf of our employes. "We have not knowingly made any discrimination against men because they belonged to unions. Likewise we cannot be expected to discriminate against employes who elect not to be affiliated with outside unions. In fairness to the majority of our employes who do not belong to unions, we shall endeavor to do our utmost to keep them from being coerced against their will into joining any union or association whatsoever."

Such a statement seemed to nail the automobile industry down in a position from which the Labor Board, lacking authority to force a settlement, could not budge it.

But General Johnson thought he could break the deadlock. That same evening he proposed to Mr. Knudsen a compromise based on the establishment of a grievance committee to arbitrate complaints about discrimination against A. F. of L. members, on holding shop elections. Then General Johnson persuaded the automobile code authority, consisting of Walter P. Chrysler, Alfred P. Sloan Jr. and Alvan Macauley, to promise to meet and consider his proposal. Though hope was part of the Johnson strategy everyone realized that no purely technical solution could satisfy both sides. The basic question in the industry remained: open shop or closed?

That question the Automobile Chamber picked up and answered in a blunt statement : "There is only one fundamental issue: namely, whether the automobile industry is to be run by the American Federation of Labor. . . . The industry does not intend to recognize the A. F. of L. as such, nor to enter into any contract with it on behalf of its employes." That sounded very much as if the industry was inviting the strike to settle the Union issue once and for all.

When Messrs. Chrysler, Sloan & Macauley met in Manhattan they felt sure that neither the A. F. of L. nor a Government sympathetic to the A. F. of L. could easily swing public opinion against their industry. Their reason was that the A. F. of L.'s case was not based on low wages but on the desire to capture control of the automobile industry. Their own case was put for them by Edward A. Filene of Boston who issued a peace appeal to both sides: "It is not as if General Motors were typical of the old capitalism in which employers stood surlily upon their legal and their property rights. General Motors is in the very vanguard of the new capitalism in which the employer recognizes the business necessity for higher and higher wages, shorter and shorter work days and all the advantages to labor for which labor unionism stands. ..."

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