The Buck Stopped There

Until now, the Pay Board and the Price Commission have not exactly acquired a reputation for firm gutsiness. While many wage and price increases have been properly trimmed, some embarrassingly large raises have been allowed to go through. Last week, however, both panels struck out against inflationary permissiveness.

Dean C. Jackson Grayson's Price Commission lowered the average yearly increase allowed large firms under its Term Limit Pricing rule from 2% to 1.8%. Grayson also properly chastised Agriculture Secretary Earl Butz, who had praised the present high meat prices before a cattlemen's group a few days earlier. Butz's speech was "damaging to the stabilization program," bristled Grayson. "Everyone must work to hold prices down, not push prices up as Secretary Butz is advocating."

Meanwhile, Judge George Boldt's Pay Board thumbed down a 20.9% first-year raise for West Coast longshoremen. The board voted instead to allow a 14.9% increase, generous by almost any standard. The move represented the first time that the board had refused any sizable demand from a union with the clout to inflict serious damage on the economy by striking. The board did reduce an aerospace workers' contract increase from 12% to 8% earlier this year, but that industry was already so weak that the workers were not likely to risk walking out.

The longshoremen's contract had ended a devastating 134-day strike last month against the shipping companies. The contract called for first-year increases of 16% in pay and 4.9% in fringes. The Pay Board allowed all the fringes but cut the wage increase to 10%. Though board rules permit a maximum combined increase of 8.9% in most cases, a board staff report suggested that the dock workers' increased productivity might merit them an exception to the rules. West Coast longshoremen have shown a huge 134% increase in output per man-hour over the past decade. Said Harry Bridges, their president: "The workers I represent produce one hell of a lot for the wages they get."

The board was only slightly impressed, since the union had already been rewarded in previous contracts for some of the productivity gains. In addition, many of the companies that signed the contract had not even waited for the Pay Board to act before applying for freight-rate increases of 15% to 25% to offset increased labor costs. Thus the contract's inflationary potential was almost immediately apparent.

Bridges has vowed to lead his men back out on strike if the Pay Board cuts the contract "by as much as 1-c-." Since Bridges is suspected by many in his rank and file of being too accommodating with management, he will be under pressure to carry out the threat. His union's recent strike ended only days before Congress passed legislation providing for binding arbitration of the dispute. But the measure does not apply in this instance, since the contract has been accepted by both the union and the shippers. If Bridges' men walk out again, it may take another act of Congress to bring them back.

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