The War of the Wires

The steelworkers' Philip Murray could scarcely have been more overbearing. Jubilant over the presidential fact finders' recommendations that steel operators pay their workers up to 10-c- an hour for an insurance and pension program (TIME, Sept. 19), he wired U.S. Steel's austere President Benjamin Fairless: "Promptly and plainly advise me whether your companies are likewise willing to accept the recommendations of the board as a basis [for] settlement."

Up to that moment there had been good reason to hope for an early settlement. The board had denied a wage boost. Steel operators had been pleasantly surprised by the moderation of the board's recommendations. They were ready to sit down and talk when Phil Murray sounded his trumpet. Murray, in effect, was demanding that steel accept the board's recommendations first and bargain afterwards.

Fairless blew off like a Bessemer converter. Did Murray think he could take him by the nose and lead him to a contract? Promptly and plainly he told Murray off. He would negotiate, but with no commitment in advance to accept anything. That was the basis on which Fairless had agreed to meet with the fact finders in the first place; the board itself had reiterated that details should be worked out in company-by-company bargaining. If that didn't suit Murray, then a steel shutdown would be on Murray's head. Up to that point Fairless had made no comment whatever on the virtue of the fact finders' recommendations. Now, while the rest of the steel world listened respectfully, he commented at length.

In Different Clothes. Fairless was for "proper" insurance and pension programs. By "proper" he meant programs to which the workers themselves contributed something. As for noncontributory welfare programs which provided benefits for the workers "at the expense of someone else" (i.e., management), this was "a revolutionary doctrine of far-reaching and serious consequences."

Such a program in a basic industry like steel, Fairless declared, would set a pattern which would undermine the theory of all the hundreds of contributory plans in the U.S. Furthermore, a national pattern of noncontributory programs "would be a fourth round of employee benefits dressed in different clothes." Such a program would cost the steel industry about $200 million a year and would lift the cost of steel, Fairless added significantly, as much as $3 a ton.

Question of Precedent. Although it was obviously true that pensions would cost the steelmen money, the fact finders had agreed among themselves that steel's profits were large enough to absorb the full cost of the pension and welfare plans. Nevertheless, Steelman Fairless was on firm ground when he insisted that this was a matter to be thrashed out at the bargaining table. That was a part of the original agreement.

But in saying that a pension and welfare plan financed entirely by management would set a precedent, Ben Fairless was not on firm ground. Murray's union already had a number of noncontributory contracts among some 400 pension and insurance agreements with the steel industry and metal fabricators. Bethlehem Steel and Jones & Laughlin had been paying the full cost of pension plans for more than 20 years. Fairless' U.S. Steel itself had been an important party to the royalty-pension contract which operators of soft-coal mines had signed with John Lewis (see below). A steel spokesman said: "The Government forced that down our throats." Nevertheless, there it was in Big Steel's throat.

The precedent was already established. The question now was: should it be extended?

The Meaning of Words. All sober questions were temporarily lost, however, in the acrimony of Murray's and Fairless' continuing debate. All week they thundered at each other over Western Union's wires. Murray telegraphed Fairless that the operators' attitude was "the public be damned," that steel was trying "to force a strike on the nation." Fairless wired Murray that he was being "dictatorial." Murray fired back that he would like to see Fairless (who was himself in line for a noncontributory pension of $50,000 a year) justify before the public his "attitude of horror towards noncontributory pensions and social insurance" for his workers. Fairless retired into silence.

At week's end, Federal Mediator Cyrus Ching, a hulking, peace-loving man, suggested that they all meet with him in Washington. Taking the amiable view that the disputants just did not understand one another, Ching said optimistically: "There is a good possibility that the argument springs not from irreconcilable, fundamental differences, but from the meaning of words. At any rate, it is my duty to ascertain whether this is the case."

This week the disputants traveled to Washington. There, at the head of a delegation of 71 officials of the nation's steel companies, Fairless met a very weary-looking Phil Murray. They posed together for photographers. Said Ching: "Let us all say 'cheese' when we have our picture taken so we will look pretty." Then they got down to business in the Labor building.

A few hours later, Murray and his eleven aides emerged. This time Murray made his meaning quite clear. To reporters he said: "If by late Saturday night the companies have not agreed to 4-c- for insurance and 6-c- for pensions on a noncontributory basis, the mills will go down. I can say that flatly." Steel operators had no comment. Ching, still hopeful, looked forward to another meeting the next day.

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