Wednesday, March 9, 2011

Master and Servant Revisited

“One hand washes the other”
Labor and Capital, Master and Servant

Once upon a time, the labor movement was the most radical movement in the world. Unions promised not only to improve the living and working conditions of everyone in the union, but they also promised to be vehicles of larger social and economic transformation. While contesting visions and methods have always struggled against each other within the labor movement, it is fair to say that today the labor movement is in a universal crisis. The crisis is particularly apparent in the United States, where unions are ever less capable of delivering on either their immediate or long-term promises. From the perspective of greater social transformation, the US labor movement today is a historic embarrassment: If unions were once synonymous with change, struggle and the greater good, today they are more associated with conservatism, survival and the status quo. How has this happened? By what logic and dynamic has this metamorphosis taken place? If we are to engage seriously in the many debates today about the revival and renewal of the labor movement in these times of unprecedented crisis, we must have answers to these questions. To find them, I propose that we must return to the root and origin of the labor movement: the relationship between capital and labor, and between master and servant.

In 1807, Georg Hegel published what remains today perhaps the most intriguing and insightful (if controversial) essay on the relationship between master and servant. While an incredible number of volumes have been written analyzing this single essay alone, some of the principal arguments can be briefly summarized as follows: The servant is ultimately the real master, not only because the master depends on the servant, but because while masters only need to be conscious of themselves, servants must have a more sophisticated double consciousness, both of themselves and of their master. However, the servant does not automatically become the master or equal to the master. Servants must first realize themselves, Hegel explains, through labor, and also through a confrontation with the master, which alone can force the master to recognize the servant as an equal. Before servants have realized themselves completely and have not received real recognition, they tend to recapitulate the master’s ideas and commands, believing them to be their own.

Hegel’s understanding of the relationship between the master and servant can go a long way in interpreting, if not completely explaining, the relationship between labor and capital that has culminated in our current historical moment: If capital is master and labor is servant, labor is ultimately the real master because capital depends on labor for the creation of value and hence profit. While capitalists can afford to entertain mystical ideologies that justify their rule, the working classes must not only understand bourgeois consciousness, but also have a concrete understanding of the world from their own perspective.1 However, has history has clearly demonstrated, labor does not overthrow capital automatically, despite its innate ability to do so. The working class must first realize itself through the labor process and through struggle against capital. Absent this critical struggle, labor is not recognized as equal but remains subordinate. And moreover, absent this struggle, labor recapitulates capital, not only in economic and organizational terms but also on the terrain of consciousness.

My intention here is not to engage in a complex debate about the influence of Hegel on Karl Marx.2 Nor is it to argue that the answers to our questions are to be found through the close re-reading of philosophical essays. Hegel, after all, was not a labor organizer. If the allegory between the master-servant dialectic and the labor-capital dialectic is not scholastically precise, it remains nonetheless practically useful for understanding how the labor movement has largely failed in its historic mission.

Recapitulating the Master

The organizational nexus through which labor recapitulates capital is the trade union. This recapitulation, or internalization of capital’s ideas and commands on the part of working class organizations, finds its most acute expression in what is known as ‘business unionism’. Even the name betrays the dynamic at work! Both in the realm of economics and psychology, business unionism is a crystal-clear example of how labor has taken on the characteristics of capital, just as servants take on the characteristics of their masters.

Economics. Business unionism is not an epithet coined by radicals but a well-established and powerful economic force. Perhaps no one said it more clearly than John L.Lewis, founding father of the Congress of Industrial Organization (CIO):

“Trade unionism is a phenomenon of capitalism quite similar to the corporation. One is essentially a pooling of labor for the purpose of common action in production and sales. The other is a pooling of capital for exactly the same purpose. The economic aims of both are identical -- gain.” (Moody p56-7)

Business unionism not only implies a certain economic prerogative which is analogous if not identical to a corporation, but a political imperative as well. In the 1950s, Teamster president Dave Beck famously admitted that “[u]nions are big business. Why should truck drivers and bottle washers be allowed to make big decisions affecting union policy? Would any corporation allow it?” (Moody p57) Just as business unionism reflects the economic logic of the profit system, it also re-enacts the anti-democratic logic of the corporate political system. In 1940, Max Horkheimer recognized that “The leading man and his clique become as independent in the working-class organization as the board of directors in an industrial monopoly is from the stockholders.” (Horkheimer 1940) Business union leaders also take on the role of the foreman in the factory. These tendencies are generally apparent through the enforcement of no-strike pledges, etc, but are always particularly apparent in times of war. Steelworker president Philip Murray announced after Pearl Harbor that “[l]abor is determined to place itself in the forefront in the battle of achieving maximum production.” (Zieger p143)

In the last thirty years, unions have continued to mirror the development of capitalism as it has undergone perhaps the greatest transformation since the industrial revolution. Just as corporations have accelerated the trend towards monopoly, labor has followed, with a pattern of mergers that Kim Moody has called the transition from industrial unionism to general unionism. (Moody p196) Just as corporate mergers have brought together previously unrelated industries under the same corporate brand, so unions have merged workers across equally unrelated industries under the same union banner. The reason in both cases has been the same -- money. As it has become easier for corporations to generate profit by buying each other than by investing in the production of new value, so it has become easier for business unions to increase their coffers by merging with other unions than by organizing new workers. As AFL-CIO regional director Kevin Kistler explained to the master newspaper the Wall Street Journal “It’s a hell of a lot quicker and cheaper to add members through a merger than it is to organize new members.” (Moody p198)

A great deal has been written about the economic, political and cultural consequences of business unionism, both throughout history and today. But there has been no effort to my knowledge to take business unionism at face value and apply a frank economic analysis to unions as this analysis is commonly applied to capitalist firms. As business unions grow to resemble their corporate counterparts more and more, this seems increasingly possible. Unions today, in the words of their own leaders, are big business, and their business is the accumulation of capital. Just as there is a capitalist regime of accumulation, there is a unionist regime of accumulation. If their motives are distinct, and if profits and dues are utterly different animals, their methods of accumulation are strikingly similar.

The rising organic composition of capital prophesied by Marx which results in a declining rate of profit3 has a direct corollary in unions today. Just like corporations, unions are increasingly investing in fixed capital, that is, in resources that do not directly generate new value. The increasing primacy of service providing, carried out by business agents, health fund and pension fund managers, along with the increasing importance of research departments and computer database managers in unions today, contribute nothing directly to the accumulation of new capital (through the form of members’ dues) in the union coffers. Organizing, whose corollary in the business world would be investment in new production, is a very small percentage of the budget of business unions. All of this is difficult to quantify, however, because unions also share with corporations a vested interest in burying the numbers, if for different reasons. (For example, see Voss and Sherman 2000) The tendency towards financialization is evident in the union world as well. Union credit cards and finance plans are on the rise. The investment of union funds in the stock market is particularly consequential. In the stock market, the accumulation of capital by both corporations and unions follows the exact same pattern and logic, effectively binding the interests of union members with the interests of capitalist accumulation. If a falling rate of density as a result of increased composition of fixed union capital is as difficult to prove today as a falling rate of profit, it is enough for the purposes of this essay to point out that the resemblance is there, and that the consequences for the working class are highly inauspicious.

Psychology. Business unionism is not only about economics, it is also a world-view, a weltanschauung that both arises from the economics of unions as institutions, but also drives these institutions and manages their economic decisions. Here in particular the relevance of Hegel’s master-servant dialectic is relevant. Labor recapitulates capital and unionists adopt the ideology of businessmen as their own. This goes beyond the famous trite declaration of the American Federation of Labor (AFL) president George Meany at the end of his career that he “never walked a picket line in his life.” Meany himself was more specific about the world-view that guided his practice as a labor leader. “We are dedicated to freedom,” he wrote in 1955, “through a system of private enterprise. We believe in the American profit system.” (Moody p56) David Dubinsky, president of the International Ladies Garment Workers Union (ILGWU) went even further in announcing the complete subservience of labor to capital when he wrote that “[t]rade unionism needs capitalism like a fish needs water.” (Murolo and Chitty p241) Indeed, renouncing the existential struggle between labor and capital on both economic and epistemic terms seems to be a prerequisite for the presidents of the largest US unions.4 United Auto Workers (UAW) president Walter Reuther, using the royal we, insisted once and for all that “[w]e make collective bargaining agreements, not revolutions.”(Murulo and Chitty p240)

Labor leaders have not only adopted the ideology of capitalists, but they have also inherited the short-sightedness which is characteristic of the business world. Just as financiers from the 1920s to today do not see much beyond the horizon of quarterly profits, so a startling number of labor leaders throughout US history have had no long-term vision of their work or their movement. “We have no ultimate ends,” said Adolph Strasser, an early AFL leader, who continued, “[w]e are going on from day to day. We are fighting for immediate objects -- objects that can be realized in a few years.” (Moody p56) Decades later, William Olwell, director of collective bargaining for the United Food and Commercial Workers (UFCW) said in 1986 that “[w]e don’t have a national picture as to what we want. We can’t say we want 12% across the board for each year of the contract, in all areas of the country. It doesn’t work that way. We have to look at each local situation.” (Moody p204) This tendency has accelerated into our times. The most die-hard supporter of unions today will be hard pressed to point to a long term strategy and vision for the labor movement in the post-9/11 context of late US imperialism.

The psychology of the master pervades not only the union leadership, but the union membership as well. While the working class has always identified to some extent with capitalists (just as all servants identify to some extent with their masters), the trend towards business unionism has deepened this dynamic. The investment of union money in the stock market in particular forces workers to directly identify their material well-being with the ruling class and capitalist system as a whole.

However, many union members see through this, and in general have recognized the collaboration of their unions with corporate management. Dave, an African American worker at the General Motors factory in Lordstown, Ohio saw the relationship clearly when he said that the union and management “work hand in hand. One hand washes the other.” (Aronowitz p45) Labor absolves Capital of its exploitative excesses and Capital also absolves Labor -- due to capital, even a bad union is better than no union. But while there is an innate consciousness on the part of workers as to their real relationship to the boss and to capitalism, this consciousness is muted and blunted by the union bureaucracies which tend to repress or redirect most if not all the more subversive inclinations of its members.

The 1950s serve as an excellent case study of business unionism at its height. There were more strikes in the 1950s than any other decade in US history (Metzgar p207), but the profoundly conservative status quo was also more firmly entrenched than ever before. Bureaucrats had firmly seized control of almost all the major unions, and in spite of much resistance from the rank and file, (Moody p31) unions had never been more accepted and respected in US society at large. Because labor recapitulated capital, it was allowed to receive marvelous concessions in return.5 At the price of accepting the terms of the master, certain limited sectors of the organized working class achieved remarkable social mobility, illustrating Max Horkheimer’s maxim that “[i]ntegration is the price which individuals and groups have to pay in order to flourish under capitalism.” (Horkheimer [1940] 1983, italics in original) However, these victories were dubious on two counts. Firstly, they were not shared. If members of the Steelworkers union were catapulted into the middle class, larger sections of the working class were left behind. This disparity would grow over time, to the extent that Stanley Aronowitz could write in the 1970s that

“[t]he last thirty-five years of industrial unionism have failed to effect any substantive change in the distribution of income. Trade unionism under conditions of partial unionization of the labor force can do no more than redistribute income within the working class.” (Aronowitz p254)

Secondly, the labor-capital/servant-master relationship itself was never challenged. It’s still at the top of every union contract, titled “Management Rights”. Union members were afforded greater freedom, but remained wage workers whose labor power continued to be expropriated by capitalists.

Hegel foresaw that the servant could achieve a measure of independence while remaining a servant, writing about the master that “the aspect of its independence he leaves to the bondsman, who labours upon it.” Jack Metzgar’s account of the real victories of business unionism in the 1950s should be put into context, perhaps, of the famous quotation of Frederick Douglass, that “slaves are generally expected to sing as well as to work.”

The current stage of economic development in the United States today is often referred to as ‘late capitalism’. The qualifier ‘late’ indicates not necessarily that capitalism is about to end, but that it has reached a stage where it is both caught in the culmination of all of its fundamental contradictions, and also constitutionally incapable of resolving these contradictions in the old ways. Corresponding to this era, we might define the current stage of the labor movement as ‘late unionism’; in which unions are caught in their own web of crises from which they seem by all accounts incapable of extricating themselves. The servant’s recapitulation of the master has been carried to its utmost point, from where it can only continue to labor upon what independence it has left, but go no further. The servant must either accept mastery whatever the cost, or set about overcoming both itself and its master. To achieve this, however, several things are necessary. Following Hegel, the servant must be recognized by the master, and this can only be achieved if the servant experiences both “service and fear”, and finally, the servant must also pass through a “trial by death.”

Overcoming both Master and Self, Capital and Labor

The struggle to overcome the master is also a struggle to overcome the self. Both must happen at once and each is the precondition for the other. For centuries, the primacy and priority of the economic struggle (and the whole detailed history of discourse insisting on this point) has distracted many from understanding the real nature of this struggle. Because fundamentally the economic struggle is a struggle for the liberation of human consciousness. Our minds must be free for us to struggle. “Men live by fantasies as much as by reality,” as Melvyn Dubofsky wrote (Dubofsky p4), and animal spirits govern the shop floor as much as the stock market. Until these fantasies are overcome, the economic struggle against capital is a doomed struggle: “Only the consciousness of the proletariat,” wrote Georg Lukacs, “can point to the way that leads out of the impasse of capitalism.” (Lukacs p76, italics in original).6 The struggle of the servant to both overcome its illusions, and to overcome its master, is an ancient struggle. In fact it is older even than the struggle between capital and labor. “[T]he law of master and servant,” wrote Karen Orren, “was at the foundation of capitalist development and industrialism, and was not their result.” (Orren p70) Overcoming this ancient law is no small task, but it remains as urgent as it is daunting.

Recognition. When the servant overcomes itself and its master, the master will finally recognize the servant as a self-consciousness unto itself. For real recognition to be achieved, the moment must come when both master and servant see each others as equals. But Hegel foresaw the possibility of a false or partial recognition. “[A] form of recognition has arisen that is one-sided and unequal,” Hegel wrote. The corollary today is union recognition; the recognition that a capitalist firm gives to a labor union, in the form of a contract. This form of recognition is not only false but pernicious; it serves to actively preempt the struggle for real recognition. As part of a recognized union, workers and labor leaders mistake their own elevated status for emancipation from the master-servant relationship.7

In her book Belated Feudalism, Karen Orren undertakes an extensive review of the roots of US labor law in the feudal English common law, discerning “an unbroken line stretching from labor regulation in Tudor England... to labor regulation in Gilded Age America.” (Orren p14)8 She demonstrates persuasively that the law of master and servant defined centuries of law in the United States. But she takes a leap of faith when she argues that the common law was overcome in 1937 with New Deal labor legislation. While unions in this era did obtain a formal recognition from employers and the right to collectively bargain with them for the first time, this was, in Hegel’s terms, a one-sided and unequal recognition. First and foremost, this recognition obligated unions to enforce uninterrupted production. Collective bargaining and contracts disguised a one-sided and unequal class war. “The product of the charade that is characteristic of much of collective bargaining today,” writes Stanley Aronowitz, “is a mammoth document which reads more like a corporate contract or a mortgage agreement than anything else. In fact, it is a bill of sale.” (Aronowitz p220) As much as collective bargaining and contracts make an immense difference to workers, they do not challenge the law of servitude, and only grant workers a greater degree of independence. Servants obtain a recognition which does not liberate them from servitude.

Service and fear. In order for the servant to become truly conscious of itself and thus overcome its mentality of servitude, Hegel insisted that both service and fear are necessary. Furthermore, “both must exist in a universal manner.” Servitude and fear of the master must be so pervasive that the servant understands the full depravity of its position in relation to the master. If service and fear are only partial, Hegel argues that the servant may not come to understand the necessity of its own complete emancipation. If the consciousness of the servant is not “tottered and shaken” by fear and coercion, then the servant’s emancipation may be similarly limited, both in body and in mind. For the unshaken servant, “having a ‘mind of its own’ is simply stubbornness, a type of freedom which does not get beyond the attitude of bondage.” (italics added)

This is exactly what business unionism delivers to its members. While workers are granted a substantial measure of freedom, this freedom does not go beyond the attitude of bondage. Collective bargaining, the contract, the grievance procedure, and even the picket line or strike, by delivering the laborer from absolute service and fear of capital, does not challenge the law of the master but “is rather a piece of cleverness which has mastery within a certain range, but not over the universal power nor over the entire objective reality.” (Hegel) By protecting workers from the ruthlessness of capital, in Hegel’s terms, unions may actually serve to preserve the master-servant relationship. “If the trade union remains an elementary organ of struggle,” writes Aronowitz,

“it has also evolved into a force for integrating the workers into the corporate capitalist system... Even the most enlightened trade union leader cannot fail to play his part as an element in the mechanisms of domination over workers’ rights to spontaneously struggle... The role of collective bargaining today is to provide a rigid institutional framework for the conduct of class struggle. This struggle at the point of production has become regulated in the same way as have electric and telephone rates, prices of basic commodities, and foreign trade.” (Aronowitz p217-218)

This will come to many as a paradoxical and somewhat bewildering argument -- that the principal organization for the defense of the working class functions as a mechanism to prevent the working class from overcoming both capital and itself. But it must be reckoned with. To reject unions certainly seems suicidal for the working class, but if unions are preventing workers from overcoming capital, what then?

Trial by death. The final test which the servant must pass to overcome itself and its master is the trial by death. If the servant does not risk its own life against the domination of the master and enter into a mortal contest with it, the master will never recognize the servant as an equal and the servant will never recognize and overcome itself. This trial has its corollary in the labor-capital relationship in the class war. However, as with false recognition, Hegel foresaw that this trial by death can by preempted by a half-hearted struggle wherein the master-servant law remains ultimately unchallenged. In this false trial,

“there vanishes from the play of change the essential moment, viz. that of breaking up into extremes with opposite characteristics; and the middle term collapses into a lifeless unity which is broken up into lifeless extremes, merely existent and not opposed.” (Hegel)

This is the state in which the labor capital relationship as mediated by unions finds itself today. Unions negotiate a struggle that substitutes for a trial by death. Instead of a class war in which labor faces off against capital in a fight to the finish, unions facilitate a muted contest between employers and employees in which the real nature of the master-servant relationship is often largely obscured. The culture and procedures of the union itself can have many adverse consequences for the class consciousness of workers, who in many unions are systematically mis-educated about their ultimate relationship to the boss. Insofar as unions serve to prevent the trial by death of class war, they will preserve the master-servant law. Unwittingly, unions thus undermine themselves. For unlike labor leaders, capitalists are not fooled, and recognize in unions a real existential threat.

Seen in this light, the world-historic mission of servants and the working class to overcome themselves, their masters and the capitalist system, is in serious ways impeded by unions. They preempt the service and fear, the trial by death, and the ultimate real recognition which would signify the end of bondage once and for all. Until labor leaders understand the true nature of the master-servant relationship from which the labor movement arises, and until the union apparatus reflects this understanding, it is unlikely that unions or union members will be very successful or effective in struggling against an adversary that understands this relationship much more clearly.

Survival or Liberation?

The final promise of Hegel’s essay on the master and bondsman is that “bondage will, when completed, pass into the opposite of what it immediately is: being a consciousness repressed within itself, it will enter into itself, and change round into real and true independence.” (Hegel) It is in this framework that we should situate the debate on the revitalization of the labor movement. However, most of the discourse on this important subject does not acknowledge the master-servant relationship at the root of the problem. This leads to discussions that mistake the struggle for liberation with a struggle for survival.

Business unionism and its ideology is so pervasive today that we must be careful not to confuse the revival of the labor movement with the revival of business unions. Lukacs warned that “the highest degree of unconsciousness, the crassest form of ‘false consciousness’ always manifests itself when the conscious mastery of economic phenomena appears to be at its greatest.” (Lukacs p64) In the United States and throughout the so-called advanced capitalist world, we must ask ourselves honestly if we can even imagine what a revitalization of the labor movement would look like. Can we conceive of it? If a revived labor movement arose, would we recognize it?

We are forced to ask this question because declarations of victory and revitalization abound even in conditions where the master-servant relationship is firmly entrenched. Jack Metzgar for instance writes that “[i]f what we lived through in the 1950s was not liberation, then liberation never happens in real human lives.” (Metzgar p39) While his story is important and touching, we must wonder if the social mobility of steel workers is really comparable with a whole world history of successful revolutionary movements, from decolonization to communism. (His claim is further complicated by the fact that these steel workers were making Polaris missiles (Metzgar p74), and that the US in this period “consumed about one-third of all goods and services in the world.” (Metzgar p147))

Another example of dubious revitalization is illustrated in another story about members of the Steelworkers union, this time decades later, in Ravenswood, Virginia. “Never in the history of the labor movement has anyone achieved a victory of the magnitude that you have won,” union leader George Becker told a crowd at a victory rally. (Juravich and Bronfenbrenner, p196) Becker’s statement was more than slightly over the top. While workers at Ravenswood ultimately won an incredible victory and got their jobs back after being illegally locked out, the fugitive criminal financier who was the target of their campaign went free, scabs kept their jobs in the factory, hazardous working conditions were not improved, environmental issues were never resolved, and workers ultimately received only a symbolic pittance of the back pay which was owed to them. Moreover, the social movement which they had built dissipated immediately after their victory. (Juravich and Bronfenbrenner 1999)

While Metzgar and Juravich and Bronfenbrenner provide isolated historical examples of revivals in particular unions, in her book Forces of Labor, Beverly Silver provides a broader picture of the labor movement from 1870 to the 21st century. She describes how labor unrest has followed capitalist production around the globe, particularly in the auto industry. Wherever capital has gone, labor militancy has followed. Absent from her book is a discussion of the price paid for this labor unrest. In the United States, Germany, Brazil, South Korea and elsewhere, workers were exploited and the environment was despoiled for years before a labor movement arose which was capable of making headlines. When these unions did come to power, they did not challenge capitalism on a systemic level. And when industry moved elsewhere, unions were powerless to stop them. For all these reasons we must wonder if her book couldn’t just as easily be titled Forces of Capital. Silver’s book highlights the danger of fetishizing “labor unrest” – the struggle against capital and against the law of the master is obscured, and once again survival is mistaken for revival.

These examples demonstrate that the debate about revitalization of the labor movement has a long way to go. In this discourse it is especially apparent that unions must be emancipated from their illusions about themselves to truly move forward and play a role in the revival of a labor movement worthy of the name. The labor movement needs to free its collective mind. “It is an ideological crisis which must be solved,” wrote Lukacs, “before a practical solution to the world’s economic crisis can be found.” (Lukacs, p79)

A strategy to revive a labor movement must understand the immense and unprecedented crisis upon whose edge the world today hangs. Immanuel Wallerstein wrote in 2009 that “[t]he crucial battle... in the middle run (next 15-25 years)... is a battle not about capitalism, but about what will replace it as an historical social system.” (Wallerstein 2009) In these end times, the master-servant relationship remains as entrenched as ever. It may easily outlive capitalism.9 Meanwhile, as corporations have become transnational, unions are reaching in that direction as well -- for better or worse. Will labor continue to recapitulate capital? “Global unions are the future,” we are told. (For example see Bronfenbrenner 2007) Will they outsource strikes, and exploit cheap labor movements abroad? Or will labor, locally and globally, realize itself, overcome itself, and transform itself, from a movement of servitude to a movement of independence?

1 “[W]orking-class thought operates in a universe where it recognizes its general inferiority in knowledge without ever relinquishing the validity of its own point of view.” (Metzgar p134)
2 In fact, Marx never once mentioned Hegel’s Master-Servant essay in all of his writings. (Arthur 1983)
3 For readers unfamiliar with Marx’s economic theory, a good summary of the theory of the falling rate of profit by Ernest Mandel can be found here:
4 Max Horkheimer reserved some harsh words in his description of the job qualifications for such capitalist labor leaders: “Robust health, the good fortune of being acceptable to the average member and not unacceptable to the ruling power, a dependable aversion to adventure, the gift of being able to deal with the opposition, a preparedness to proclaim the greatest incoherence as a virtue to the crowd and to oneself, nihilism and self-contempt -- these are the necessary qualities.” Horkheimer 1940
5 “By 1980 the individual steelworker’s average wage was nearly 40 percent higher than the median income of all U.S. households.” (Metzgar p182) It is essential here to understand here that steel workers were near and at the very bottom of the social and economic hierarchy of the United States prior to the 1930s.
6 “As long as this consciousness is lacking,” Lukacs continues, “the crisis remains permanent, it goes back to its starting-point, repeats the cycle until after infinite sufferings and terrible detours the school of history completes the education of the proletariat and conveys upon it the leadership of mankind.” (Lukacs, p76)
7 “Status-consciousness -- a real historical factor -- masks class consciousness; in fact it prevents it from emerging at all.” (Lukacs, p58)
8 “The American preoccupation with liberalism,” she writes, “has been caused not by the absence of feudalism but its persistence... (p3) [T]he labor system in place in the U.S. after the Civil war was in its essentials changed since the late Middle Ages... (p4) Despite enormous differences between the feudal landowner and the American entrepreneur... labor regulation has been entrusted to institutions associated politically with the employing classes; the original justices of the peace were employers... legal formalities and their ancient pedigree provided social cohesion as well as legal.” (p12-13)
9 “Capitalism’s ability to outlive the market economy was announced long ago in the fate of the working class organizations,” wrote Horkheimer in 1940: “The call to unite in trade unions... was carried out to the letter, but these organizations carried out not so much the unnatural tasks of the united proletariat, namely the resistance to class society in general, as that of submitting to the natural conditions of their own development into mass organizations. They integrated themselves into the transformations of the economy.” (Horkheimer)

An Injury to All, The Decline of American Unionism, by Kim Moody, Verso, New York 1988
From the Folks Who Brought You the Weekend, A Short, Illustrated History of Labor in the United States, by Priscilla Murolo and A. B. Chitty, illustrated by Joe Sacco, The New Press, New York 2001
The CIO 1935-1955, by Robert H. Zieger, University of North Carolina Press, Chapel Hill 1995
History and Class Consciousness, Studies in Marxist Dialectics by Georg Lukacs, translated by Rodney Livingstone, MIT Press, Cambridge, MA 1968
Striking Steel, Solidarity Remembered, by Jack Metzgar, Temple University Press, Philadelphia, 2000
False Promises, The Shaping of American Working Class Consciousness, by Stanley Aronowitz, Duke University Press, Durham and London, 1992
Belated Feudalism, Labor, the Law, and Liberal Development in the US, by Karen Orren, Cambridge University Press, 1991
Ravenswood, The Steelworkers’ Victory and the Revival of American Labor, by Tom Juravich and Kate Bronfenbrenner, ILR Press, Ithaca and London, 1999
Global Unions, Challenging transnational capital through cross-border campaigns, edited by Kate Bronfenbrenner, ILR Press, 2007
Forces of Labor, Workers’ Movements and Globalization since 1870, by Beverly J. Silver, Cambridge University Press, 2003
Master and Slave, excerpt from G.W.F. Hegel, The Phenomenology of Mind, first published in 1807
Hegel’s Master-Slave Dialiectic and a Myth of Marxology, by Chris Arthur, New Left Review, November-December 1983
The Authoritarian State, by Max Horkheimer, [1940] Telos Press, Spring 1983
Breaking the Iron Law of Oligarchy: Union Revitalizaton in the American Labor Movement, by Kim Voss and Rachel Sherman, The American Journal of Sociology, September 2000
The Current Conjuncture: Short-run and Middle-run Projections, by Immanuel Wallerstein, Monthly Review Zine, December 15 2009

Thursday, March 3, 2011

Whose New Deal?

The New Deal from the Standpoint of its Victims

A deal is by definition a compromise. It may be either an honorable bargain or a shady transaction, but any deal involves concessions. The New Deal, however, is remembered differently. Both its proponents and its detractors see and describe it as a unique moment in US history when the state gave a legislative and economic gift to the working class. Usually lost in both families of narratives is the deal itself. Lists of programs, statistics or events tend to conclude with rhetoric and eclipse a holistic or systemic analysis of the New Deal within the political economy of crisis in the 1930s and beyond.

The debate over the New Deal has gained new importance in the twenty first century as the United States finds itself poised on the edge of an economic crisis comparable to the Great Depression. In the mainstream, many politicians invoke the rhetoric of the New Deal, for varying reasons. Multitudes voted for Barack Obama with the New Deal in mind. On the Left as well, the New Deal and its programs are remembered nostalgically, while demands, proposals and manifestos are being drafted calling for a return to the New Deal. In the labor movement in particular, whose constituents straddle many of the usual political divides, calls for a new New Deal are now almost universal.

In today’s reigning political climate of austerity (similar in some ways to the late 1920s and early 1930s) when all notions of the state’s responsibility to its citizens are under attack, the revival of New Deal ideas and New Deal rhetoric can be welcomed as an important counter-weight to those groups who would see all vestiges of the welfare state demolished. A major economic and political reform is the bare minimum necessary for the survival of the United States in the impending crises. But most if not all of the New Deal revivalism suffers from some major blind spots about the actual political and economic history of the New Deal era. If we are to add our own voices to the call for any substantial policy change to address the current crisis, it is important for us to actually study the New Deal, and in particular its failures. If history is written by its victors, it is better understood by its victims.

The New Deal did not emerge from a vacuum or fall from the sky but reflected the political dynamics of the economic system that it emerged from. Why, after all, did the nation’s elite draft a new deal with the working class? Centuries of prior struggles had failed to move legislatures towards anything similar. It was only as a result of the combination of the Great Depression and the unprecedented organization of the working class into unions that created the critical mass necessary to pass the New Deal. But it was a deal, not a gift. So the question arises: whose New Deal was it really? In particular, what did the US labor movement and working class as a whole concede in the New Deal? By framing our examination in this way we are better oriented to address the prospects for major social and economic reform in the 21st century. This will be divided into two parts, firstly a more general overview of the immediate effects of New Deal programs, and secondly an inquiry into the long-term effects of the New Deal on the labor movement.

Part One. Immediate Effects
A great deal has been written about the New Deal, and it is not my intention to recapitulate all this literature here. To be clear, the point of this essay is not to utterly condemn the New Deal, but rather to put at center stage what is usually excluded from mainstream history.

For Native Americans, the most excluded group in the United States, the New Deal really did mark a turning point for the better; although the Bureau of Indian Affairs remains an apparatus of settler colonialism, the New Deal substantially scaled back the genocidal project against indigenous language and culture. (Nichols 2003) And for all of the downtrodden, the New Deal was a powerful symbol that the state could exist to serve the common people, and the implications of this should not be underestimated.

Yet there is a curious double consciousness about this era: If triumphant narratives are the hallmark of the New Deal, it is also universally acknowledged that it failed to end the Great Depression. Those who call for a new New Deal today argue, rather simplistically, that the New Deal was just too limited, and that if it were only given more time and money, things would have been different. Overlooked in this theory are the substantial problems and contradictions that surfaced within the limited terrain that the New Deal operated inside. In their book A New Economic View of American History, Jeremy Atack and Peter Passell write that “liberal economists today get a painful surprise when they look back and see what the first modern liberals attempted.”(p642) By putting the spotlight on some of the holes in New Deal hagiography, we can better see and comprehend its real dynamics and limitations.

The Relief Association and the Red Cross oversaw the first programs that the government enacted to address the growing social friction caused by the Great Depression. The Relief Association planned to resettle over 500,000 families with its initial budget, but actually reached less than 5,000. (Dickstein p94) But the problems with these first charitable relief organizations were not only those of inefficiency or possible corruption in the case of disappearing money. There was a more profound flaw that may be invisible to statistics but is immediately apparent from testimony. “In a letter to the Daily Worker,” writes Robin Kelley in his book Hammer and Hoe, “a black Birmingham worker complained that the “Red Cross boss stands with a pistol over us while we work, like we are prisoners working out a term.’” (p20) Kelley goes on to document how, in order to determine which families were eligible for aid, relief agencies resorted to forcing people to sell their possessions and even bribing people to spy on their neighbors. (Kelley p22) Relief and charity organizations have conflicted relationships with projects and programs of social change, and historically have almost always opposed any profound challenge to the status quo. Their role in the New Deal era confirms this history. Any attempt at such a change in the 21st century will have to understand and contend with these institutions.

By 1933 it was apparent that the piece-meal charity work of the relief organizations was having little measurable effect on the nationwide crisis. The first major program for national economic reform was the National Recovery Administration. The newly created administration was tasked with nothing less than planning of the economy. Under the purview of the NRA and its code system was everything from industrial pricing to labor management. In the two years of its operations, it helped monopoly corporations get back on their feet and kept the working class on its knees. For the working class, “[t]he NRA,” write Richard Boyer and Herbert Morais in their book Labor’s Untold Story, “proved the National-Run-Around as far as they were concerned.” (p291) The government-sanctioned unions that were chartered under the NRA were quickly recognized by the industrial working class as ineffective at addressing even their most immediate needs. “By 1935,” Boyer and Morais continue, “more than 600 federal locals had been disbanded in disgust. Wages in steel averaged $560 annually, a little more than a third of the $1,500 necessary, according to government figures, to maintain a family on a minimum level.” (p291) For African American workers, the NRA was even more of a disaster, prompting others to call it ‘the Negro Removal Act’. In his book Negroes in the Great Depression, Raymond Wolters recounts that

no minimum wage codes were drafted to protect domestic servants, and higher wages intended for black workers in code industries often were denied by employers who discovered that the codes could be evaded and ignored with impunity. Negro consumers were affected adversely, however, by the rise in the cost of living which occurred when businessmen passed along the higher cost of NRA wages for white workers. (p214)

Chafing at the dangerous idea of planning the economy, even in the interests of the industrial monopolies, the NRA was ruled unconstitutional by the Supreme Court in 1935. But the same problems that haunted it would recur again in subsequent New Deal programs.

Beginning almost exactly where the NRA ended, the Works Progress Administration (WPA), perhaps the most famous of the New Deal programs, was enacted in 1935. A nation-wide program that employed millions in everything from building transport infrastructure to recording blues musicians, the WPA has been documented and engraved across the country, in movies, documentaries, and in plaques that adorn public works from sea to shining sea. Perhaps more than any other part of the New Deal, it is the centerpiece of New Deal revivalism today. The government employment of millions on public works projects was undoubtedly the most successful aspect of the New Deal and may serve as a lesson for proposals for similar policies to address the current crisis. A massive public works program is desperately needed today to repair the nation’s decaying economic and cultural infrastructure. Unfortunately, today’s many invocations of the WPA appear to lack an understanding of the shortcomings and internal structural flaws that are evident to an earnest scholar of the period.

The WPA tended to reflect the already stratified labor markets that it was imposed upon. As large as the program was, it reached only a fraction of the country’s vast army of the unemployed. And WPA jobs weren’t necessarily great jobs. Robin Kelley documents the racialized and gendered bias of WPA work programs. Not only was it most difficult for black women to get WPA positions, but it was also most difficult for them to keep the jobs once they got them. (Kelley p156) If working for the WPA was a privilege, it was also a mixed blessing. WPA wage rates were not only below union rates, but frequently also below the prevailing nonunion market wage. There was also substantial disparity between rural and urban wages in the WPA programs, which, Kelley writes, “allowed local WPA administrators to pay a Birmingham worker the city’s prevailing rate and then send him or her out to the rural areas at a lower wage.” (Kelley, p152) The tendency of New Deal programs to reflect the structural inequalities of the economy rather than reform them should be an important lesson for today’s economic stimulus proposals. Atack and Passell go so far as to suggest that even in the WPA program,

the government contributed to the unemployment problem... participation in these programs was of limited duration, sometimes part-time, and at annual wages that were often far below those in the rest of the economy. (p626)

Probably the best indicators of the efficacy of these programs can be found not in statistics but in the experiences of those who participated in them. In particular, the history of labor unrest in the WPA and other public works programs deserves to be remembered. Robin Kelley documents a WPA strike in Alabama (one of many in the country), which is worth quoting at length because it demonstrates the extent to which New Deal recapitulated the Old Deal…

“On April 15, 1936, about twelve hundred WPA workers in Birmingham and Bessemer left their jobs, and two days later another one thousand relief workers in Jefferson and Shelby counties joined the strike. The principal demands included a reversal of the suspension order, a 10 percent wage increase, and the removal or Ray Crow, whom WPA workers felt expressed antilabor attitudes. Since the walkout technically constituted a ‘strike against the government’… police, armed foremen, and the local sheriff aggressively sought to restore law and order. One of the most violent confrontations occurred at a WPA-sponsored women’s sewing project, where Communists Belle Logan and Kenneth Bridenthal had organized pickets of black woman strikers. Police and gangs of white men toting ax handles arrived on the scene and beat several black women senseless. ‘The men in charge of the project,’ reported Belle Logan, ‘had a Government truck driven up onto the sidewalk into the midst of the women, and the [WPA] guards came over with sticks and clubs and began to beat the colored women, seriously injuring three of them.’ The repression hastened the strike’s end, which occurred within a few days. When it was all over, the county administrator agreed to withdraw the curtailment order but refused to raise wages. Less than a month after the strike, the state WPA administration laid off, without warning, five thousand workers, twenty two hundred in Jefferson County alone, and reduced monthly cash relief allowances from $4.89 to a paltry $1.59.” (p 154)

Despite the many problems with the WPA, it still stands out as the high point of the New Deal. The worst aspects of the New Deal era are undoubtedly to be found in the South, and in particular in the agricultural programs. This geographic disparity, needless to say, was also a racial one.

The Agricultural Adjustment Administration was created in 1933 and was replaced by the Agricultural Adjustment Act in 1938. Despite the proliferation of programs, the African American peoples of the South got shafted by the New Deal. Not only was agricultural labor excluded from the new laws protecting the rights of industrial workers to organize, but also even within the programs that reached agricultural workers, there were serious problems. It is not only that these programs were insufficient or that they failed to ameliorate the desperate conditions of the Southern plantation economy. More importantly, the ways in which these programs were conceived and carried out can teach us a great deal about the underlying ideology and economic imperatives of the New Deal.

By the early 1930s, US agriculture had already been in serious trouble for over a decade. The Great Depression began for farmers after the first world war, when prodigious production without wartime demand translated into a crash in prices of farm goods that lasted throughout the 1920s. The financial crisis of 1929 and the subsequent crisis in industrial production quickly spread to the countryside and deepened the already profound crisis in agriculture. Despite the long-term nature of the agricultural crisis, the policy response to it in the New Deal period was hasty and haphazard. Wolters writes that “the program was approved by the House of Representatives after only two days of debate.” (p 9)

The principle plan carried out by the AAA was to enforce a reduction in agricultural production – by decreasing the supply, or so the theory went, the market would reward the farmers with higher prices. On the ground, this theory translated into the widespread destruction of crops. Raymond Wolters writes that “the AAA’s 1933 cotton contract offered government benefits of $7 to $20 per acre to those farmers who would agree to plow up from 25 to 50 percent of their cotton acreage.” (p10) Not to be forgotten as part of this program were the mass slaughter of millions of farm animals. The immediate human consequence of this drastic reduction of agricultural production was the sudden unemployment of many thousands of the poorest farmers in the South. Thus, the face of the New Deal to many African American farmers was an eviction notice. The inability of the New Deal agricultural programs to develop a solution to crisis outside of this brutal market mechanism was characterized with some clarity at the time by Secretary Henry Wallace who called it “a shocking commentary on our civilization.”

The commitment to a new equilibrium in agriculture was unaccompanied by any programs to create a new structure for the plantation economy. “[T]he AAA program was concerned only with total farm income;” explains Wolters, “the Adjustment Act did not refer to any maldistribution of income within agriculture”. (p 9) Not only was agricultural labor excluded from minimum wage regulations, it was also excluded from Social Security and unemployment insurance taxes. (Atack and Passell p671) This was no coincidence. The poor and the non-white did not vote in the 1930s, and were excluded from real politics in general, especially in the South. The agricultural New Deal was forged in the gauntlet of a legislature beholden to the most rich and powerful Southern landowners who ensured that the new conditions of accumulation accommodate their interests. When the AAA began, Wolters writes,

the 500,000 wealthiest farmers, constituting about 8 percent of the total number, received 40 percent of the national agricultural income while the bottom 50 percent of the farm population received less than 15 percent of the total farm income. (p78)

This eight percent that the Southern New Deal served proved cynically callous to the catastrophes that the relief programs caused. Because the government offered financial incentives for acreage reduction, many big planters were able to make a great deal of money by evicting great numbers of tenant farmers.

But the plight of these poor farmers was too great to be ignored. In response to the mass misery that resulted from the crop reduction program, in 1935, the Farm Security Administration (FSA) was created to help fight rural poverty (which was never part of the AAA’s mission). Unfortunately the FSA suffered from the same structural and ideological limitations as its predecessors. Harry Haywood in his book Negro Liberation writes that

while $5,328,800,000 was appropriated for A.A.A. policies during the period of 1934-41 (a disproportionate share of which went to the big landlords) the outlay for F.S.A. during the same period amounted to $1,120,600,000 -- about one-fifth of the A.A. A. appropriations. (p63)

Even this fifth was divided unequally, and along racial lines. Wolters writes that “[w]hile 192,000 Negro farm tenants were displaced during the 1930s, the FSA provided fewer than 2,000 tenant purchase loans to Negroes and resettled only 1,400 Negro families in its community projects.” (p79) In sum, therefore, it would be charitable to call the agricultural New Deal inadequate. Not only did it directly hurt those most in need, but the efforts made to redress this brutal irony were further compounded by the same contradictions.

At the beginning of the 1930s, the Southern economy was in severe decline. Perhaps, given that the system of land cultivation and ownership was a direct legacy of slavery, this wasn’t such a terrible thing. The Great Depression and the New Deal were an immense opportunity to redress the legacy of slavery and pick up where radical reconstruction left off. There were even several political radicals working within the New Deal bureaucracies to draft just such policies. But the final effect of the agricultural New Deal was precisely the opposite. Writing in 1936, Arthur F. Raper lamented that

The New Deal with its cotton restriction program, its relief expenditures, and its loan services... has rejuvenated the decaying plantation economy. Those who control the plantations are now experiencing relative prosperity. On the other hand the landless farmers... are not only failing to escape their chronic dependence but are actually losing status. Many tenants are being pushed off the land while many others are being pushed down the tenure ladder, especially from cropper to wage-hand status. (cited by Haywood p64-65)

Particularly from the perspective of African Americans, the high point for liberal progressives in American history is found to be decidedly low. African American columnist Kelly Miller reported at the time that, among the Southern black population, “the New Deal was criticized, denounced, and condemned... Nothing good was found in it.” (Wolters p356)

However, even from a macroeconomic standpoint that is largely deaf to disparities of race and gender, the New Deal as a whole is found severely wanting. Looking at the government budget throughout the interwar period as a whole, Atack and Passell document a rather startling fact for those of us who were taught that the New Deal was a golden age of welfare economics pioneered under the wise tutelage of the famous John Maynard Keynes. “On closer inspection,” Atack and Passell write,

it becomes clear that the expansionary stimulus of fiscal policy was very modest... the net impact of all government spending on aggregate demand was negative in four out of seven Roosevelt years and was surely less expansionary overall from 1933 to 1939 than it had been from 1930 to 1932! …Herbert Hoover was a better Keynesian than FDR.” (p639)

A great amount of New Deal revivalism suffers from the illusion that the political will and motivation behind the government policies of the era was generated by the altruism of Franklin Roosevelt. A thorough reading of his letters would perhaps go some way in dispelling these notions, but not completely. One curiosity that has haunted New Deal scholarship for generations has been the question of what method was used to determine the apportioning of the New Deal budget. It is an open secret that government relief was not awarded based on need. While there may never be a complete answer to why which states got more or less money than others, recent econometric research by Gavin Wright indicates that the best indicator for which region got most of the New Deal money was which state was a swing state. Atack and Passell summarize:

“It has been suggested that Roosevelt may have had something more prosaic – more Machiavellian -- in mind, too: getting himself and other Democrats reelected… The South, ever-loyal to the Democratic party, seemingly got little, while western states that switched allegiance frequently were heavily courted with dollars. Wright’s regression analysis... explains 80 percent of state-to-state variations in New Deal spending.” (A&P p644)

In this first part I have concentrated at length on the agricultural New Deal because it is most frequently excluded from accounts of the period. In general have I chosen to focus on that which is excluded not simply to rain on the parade, but because blind spots cast what is already well known into a different light. These lacunas throw a wrench in the gears of New Deal revivalism but they do not undermine it. The need for a major government-led economic stimulus program for industry and agriculture remains extremely urgent today. The best way to guarantee the success of such a program is to understand the failures of the New Deal. But in this we have only begun.

Part 2. Lasting Effects
Until now this account has run the risk of becoming a list. The risk is worth it I believe because, unlike the primrose accounts of the New Deal that list its successes, this information is not well known or comprehended. In this second part we will turn to some of the more lasting effects of the New Deal, in particular those relating to unions and the labor movement. The Great Depression was also the great leap forward for the labor movement in the United States, and this is commonly equated to New Deal legislation like the Wagner Act, which for the first time allowed unions into the economic and cultural fold of the American Dream. But there are no victories without sacrifices and no deals without concessions.

In his 1983 article Dress Rehearsal for the New Deal, Steven Fraser investigates the history of the Amalgamated Clothing Workers Union under the presidency of Sidney Hillman in the early 1900s and into the New Deal period. Fraser demonstrates that the new model of unionism pioneered by Hillman and others like him was later adopted in the New Deal and eventually became the model of unionism in the United States. Fraser summarizes Hillman’s project as nothing less than “a new system of industrial labor relations, a system predicated on the restructuring of working class behavior and culture and on decisively enlarging the terrain of state authority.” To briefly summarize the thrust of Fraser’s article, at the turn of the century, increasing labor unrest was causing no small amount of concern among the nation’s business community and labor bureaucrats. In particular, one of the most stubborn obstacles to successful financial investment was the unpredictability of labor costs. Strikes and the large expenditures required to suppress them were a perennial headache for industrialists and financiers everywhere, and they didn’t make a union president’s job any easier either. “As often as not,” Fraser explains, “stability requires change.”

In the first few decades of the twentieth century, union leaders and businessmen in the textile industry, where labor unrest was most notorious, began working together to develop a new model of labor management. At the drawing board for the new kind of unions were a group that would come to define the character of the US labor movement. “The development of needle-trades unionism,” Fraser writes, “everywhere called for the contributions of interested businessmen, social workers and social engineers, political reformers, and agencies of the state.” The introduction of the new unions was by nature contagious. Once individual industrialists began to experiment with the new regime, market forces “encouraged them to seek ways of making it a legitimate institution throughout the industry.” (Fraser) The new coalition would grow in size and influence, and by the time of the Great Depression, was poised to expand its model of unionism across every industry. The carrot of a stable work force promised by the new unionism also carried a stick: “Hillman warned that if nearsighted opposition to industrial democracy continued,” writes Fraser, “the recent revolutionary doings in Russia would be repeated elsewhere.”

Through the alchemy of the new unionism, Hillman and other pioneers in the textile industry aimed to transform unions into a form of what many unions in US history arose to struggle against – the techniques of scientific management. Developed by the perverse genius Frederick Winslow Taylor, scientific management, also known as Taylorism, aspired towards absolute control over workers in the production process. The new unionism of Hillman, which was later to become the unionism of the whole country through the New Deal, was a novel liberal form of scientific management that aimed to achieve through consent and concessions what earlier regimes had imposed by force.

The coalition between labor leaders and enthusiasts of scientific management was not metaphorical or coincidental, and it remains on the record. Hillman became close friends with Morris Cooke, the president of the Taylor Society and another honcho in the New Deal labor bureaucracy. Together they worked, Fraser recounts, to get the clothing workers union to both “apply uniform production standards through the medium of union democracy,” and also “to play a major managerial and administrative role in modernizing the clothing sector.” Hillman and Cooke stand out in history as some of the most vocal proponents of turning unions into a mechanism of scientific management. But they increasingly attracted many others. A labor manager named Meyer Jacobstein, in a Taylor Society conference in 1920, marveled at this new idea that promised to transform stewards into foremen. Jacobstein prophesized that unions, which were understood by many at the time to be incubators of revolution, could ultimately deliver to capitalists a labor management regime that would be more efficient “than that type of Prussian discipline which is purely mechanical and superimposed by officials vested with superior authority.” (Fraser)

It wasn’t all talk. Together with the help of the Taylor Society and others, Hillman was able to deliver on his promises with the textile union that he dominated. Through the establishment of a limited industrial democracy for workers that the union established in conjunction with employers, Hillman and other like-minded labor leaders were successful in getting workers to cede their right to strike. In return for a limited autonomy, unions were able to offer employers uninterrupted production and predictable labor costs in one of the most volatile industries of the economy. But economics alone could not deliver this. To persuade union members to accept the new system, the new unionism also had to have a cultural front.

In 1919, Hillman ominously declared: “We have actually worked out the moral sanction behind work.” (cited by Fraser) In the textile mills of New England, built in the image of the famously Satanic mills of Britain, and home to the unspeakable misery that is readily apparent to even the most superficial survey of textile workers from this period, this was no small claim! The new system, Fraser explains, “depended on formulating a new language and ideology… to endure,” he continues, it would not be enough to tempt workers with economic incentives. The new unionism “had to sink its roots deep into the social psyche of the garment workers.” (Fraser) The mission of the new unionism was nothing less than to assimilate generations of workers both economically and socially into a subordinate position in the American Dream. Many of these workers were not only first generation immigrants who spoke little or no English, but many also had radical political and economic views. “To make citizens was not the work of the day,” writes Fraser, and it required the cooperation of both business and government. For the promise of uninterrupted production and a domesticated, homogenous tax base, both were willing.

The unions kept up their end of the bargain. Under the new leadership, unions like the Amalgamated Clothing Workers Union converted themselves into mechanisms for the homogenization of the US working class. Fraser writes how foreign language locals were dissolved and how English-only rules were enforced at union conventions. Unions also encouraged their members to formally become US citizens. Membership education programs were started to indoctrinate members about ‘American values’ and ‘American life’. But homogenization did not revolve totally around the notions of citizenship. More specifically, it was also about bringing about a mass ideological conversion of the working class.

It must be remembered in retrospect that at the turn of the century many unions were part a very radical social movement. The vision of unions as a liberal form of scientific management where the interests of labor and capital could be reconciled arose in direct contradistinction to other contemporary unions. The Industrial Workers of the World, who called for the abolition of the wage system and for a classless society, were at the height of their influence and infamy when Hillman was getting started. The fact that unions today are for the most part conservative defenders of the status quo is an indication of the success of Hillman and the Taylor Society in implementing their plans. There is an unbroken line stretching from the Amalgamated Clothing Workers Union into the New Deal labor legislation and ending in today’s business unions. The process of transformation, however, was not automatic or inevitable.

Many of the immigrant workers in the New England textile mills where Hillman directed what Fraser calls ‘the dress rehearsal for the New Deal’ arrived on North American shores with a deeply seated belief in socialism. Fraser explains that for many immigrant groups, particularly Jews, the relationship between unions and socialism “was practically organic.” Many left their countries of origin precisely to escape the miseries of capitalist exploitation. This was a formidable obstacle to the dreams of Hillman and the Taylor Society. The apostles of the new unionism, however, developed a plan to manipulate the congenital radicalism of the union membership to serve their interests.

The liberal scientific managers argued that the best way to enforce discipline in the factory and grant the capitalist class the legitimacy in the eyes of workers would be to concede to workers a limited measure of their demands. Unions, they argued, could appeal to the radicalism of the working class but simultaneously function to contain and police it. In this way, the radicalism of workers could be controlled and manipulated. For the new unionism to succeed, political ideas like the abolition of the wage system, Fraser writes, “had to be rechanneled, transformed, and encoded in a new rhetoric of workers’ demands and perceptions emphasizing economic self-interest and industrial equity.” To this end, Fraser explains, working class militancy and the rhetoric of injustice could even be promoted, “as it enhanced the credibility of the union not only among is own membership but also among elements of the industry less inclined to accept the new arrangements without a struggle.” All of this was theorized in advance by the coalition of labor leaders, businessmen and government functionaries. At the time, this idea of unionism was nothing short of alchemical. The goal was to co-opt the radical inclinations of the working class and turn them into a new and improved form of work discipline.

There was definite opposition to this new form of unionism, not only from businessmen and statesmen who thought it was a pipe dream, but also especially from those with radical politics who understood what was going on. The lyrics to a song composed by members of another textile union with more radical and democratic leadership ran: “The Hillquits, Dubinskys and Thomases / By the workers are making false promises / They preach socialism but they practice fascism / To save capitalism for the bosses.” (cited by Aronowitz) The Trade Union Education League (TUEL) founded by the Communist Party formed perhaps the most significant organized radical opposition to the new unionism and denounced it at every chance. (Fraser) But the crisis of the Great Depression set the Communist Party on a different course, resulting in the dissolution of TUEL. As the 1930s progressed, Hillman and his associates proved ever more convincing to labor leaders, businessmen, politicians and rank-and-file workers. Promising an end to strikes for capitalists and government and an end to the class war for the working class, the Amalgamated Clothing Workers Union and its allies made an offer that was difficult to refuse. This is the hidden story behind the Wagner Act and the New Deal labor legislation which was the foundation for the modern US labor market. The, price, Fraser discerns, was politics. “Politics itself,” he writes,

that is the politics associated with the traditional slogans and categories of the class struggle, was being interred... Gone were the millenarian enthusiasms and universalist yearnings that marked the union’s founding era. Gradually they were replaced with conceptions of economic interest and political pluralism and with a concern for reform modulated by a sense of social responsibility.

While many of the CIO unions were organized by very political members and leaders, the bargain of the New Deal locked them into the legal and economic relationship designed by Hillman and others. As such, “[l]ike the ACW in an earlier era,” writes Fraser,

the CIO became a consenting partner to a relationship which guaranteed it political legitimacy and material advantages, and to which it contributed its moral and institutional authority over a working class no longer amenable to traditional forms of patriarchal dependence.

To be clear, the loyalty of the CIO to the new system of labor management and to capitalism itself was not masterminded by a few conspirators. Hillman and his friends at the Taylor Society, influential though they were, were not alone. At least since the founding of the American Federation of Labor by Samuel Gompers, there have been no shortage of US labor leaders going on the record about their devotion to class collaboration. No less a figure than John L. Lewis, founding father of the CIO, was blatant in his views on the subject, writing that

[t]rade unionism is a phenomenon of capitalism quite similar to the corporation. One is essentially a pooling of labor for the purpose of common action in production and sales. The other is a pooling of capital for exactly the same purpose. The economic aims of both are identical -- gain.” (cited by Moody p56-7)

While these ideas have never been without opposition, they have been carried on in unbroken procession through the decades. George Meany, president of the AFL in the 1950s, proudly remarked that he never walked a picket line in his life. “We are dedicated to freedom,” he wrote in 1955, “through a system of private enterprise. We believe in the American profit system.” (Moody p56) David Dubinsky, president of the International Ladies Garment Workers Union (ILGWU) went even further in announcing the complete subservience of labor to capital when he wrote that “[t]rade unionism needs capitalism like a fish needs water.” (Murolo and Chitty p241) Indeed, renouncing the existential struggle between labor and capital on both economic and ideological terms seems to be a prerequisite for the presidents of the largest US unions. United Auto Workers (UAW) president Walter Reuther insisted once and for all that “[w]e make collective bargaining agreements, not revolutions.”(Murulo and Chitty p240) Many of these quotations are well known, but they are not always understood within the context of the New Deal. They illustrate perhaps more clearly than any statistics the price that the working class paid for the New Deal.

The loyalty of unions to their state and system was tested in both the second world war and in the cold war. They passed both trials with flying colors. They proved more effective than foremen, spies and thugs had ever been at disciplining workers, discouraging strikes, and eliminating radical leadership. Meanwhile, union membership soared to unprecedented levels throughout the next few decades. Measured in union density alone, the post-New Deal era may seem like a golden age for the working class. But by other indicators the picture is less favorable. Great Depression scholar and Federal Reserve Chairman Ben Bernanke writes that “employment growth in the prewar manufacturing industries... tended to exceed that in their post-war counterparts... real wage growth was significantly larger during the prewar in all eight industries, as well as in the aggregate.” (p 171, 173) If the legacy of the New Deal was not an increase in employment or wages, what was it? To return to the question we posed at the beginning, whose New Deal was it really? While millions of working class people have had their lives improved by the New Deal, both statistics and testimony reveals that they were not the principal beneficiaries. The real victor was monopoly capital, which emerged from the New Deal and the second world war more powerful than ever. Harry Haywood is worth quoting at length:

Before the war one hundred large corporations accounted for about 30 percent of the nation’s manufacturing output. Now they put out 70 per cent of it. More than 500,000 independent business concerns went out of existence during the war. That the war strengthened Wall Street’s grip on the nation’s economy is so obvious that even an official of the Justice Department had to admit: “The concentration of economic power in the hands of a few small vested groups is today higher than ever before in our history.” (p 101-102)

The feat carried out by the New Deal was not to rejuvenate US capitalism – only the second world war was able to accomplish that. The real miracle of the New Deal was in convincing the US working class that the rejuvenation of capitalism was in their interests, and in the creation of a form of unionism which would continue to carry out this massive economic and ideological mission into the distant future. It was successful before the New Deal and remains effective today.

In 1914, textile baron Joseph Schaffner of the Hart, Schaffner and Marx company testified that

[i]n our own business, employing thousands of persons, some of them newly arrived immigrants, many of them in opposition to the wage system and hostile to employers as a class, we have observed astonishing changes in their attitudes during the four years under the influence of our labor agreement.” (cited by Fraser)

In the summer of 2009 I had the opportunity to visit a Hart Schaffner Marx textile factory outside of Chicago. I was at the time working as an intern with the United Electrical workers. We visited the factory to attend a celebration rally held by Workers United. This union was hosting a catered and televised event to publicize a recent victory – the company threatened to close the factory, but were convinced by the union leadership to reconsider. I arrived to the event late, and was surprised upon entering the plant to find that at least half of the employees were still working at their sewing machines while victory speeches were being made in the next room. I made my way into the room where the rally was being held. White men in suits were on stage making speeches for the cameras and the audience of mostly female East Asian union members was largely silent. Only once did the workers erupt into cheers without being prompted to -- when one of their coworkers took the stage and addressed them in their native language. It immediately became apparent to me that many of the workers did not speak English, and that their victory rally was in fact literally unintelligible to them. Only once was another worker brought up on the stage, not as a speaker but as a spectacle. A man congratulated the woman who was probably in her sixties on having worked several decades for the company. He then told the audience that he hoped she would be working there several decades more (!). Workers, businessmen, labor leaders, press and politicians then all adjourned for a catered lunch on the lawn. (The other half of the work force continued to work through this lunch.) This surreal celebration was a direct descendant of the kind of unionism institutionalized by the New Deal. It is emblematic of the price that the labor movement paid for inclusion into the status quo. The New Deal gave the workers of the United States unions, but it cut the heart out of the labor movement.

Conclusion: The long walk out of crisis
To see the New Deal from the standpoint of its victims is to glimpse an altogether different perspective of US history and hence the current crisis. While many radicals at the time recognized that the New Deal was a profound defeat for their ideas and organizations, radicals today often fall into the same trap that Sidney Hillman and his friends at the Taylor society created for their union members. The popular idea that the struggle for improvement in basic living conditions is automatically a struggle against capitalism is shown to be an illusion by the history of those excluded from the New Deal. Even the social democrat Norman Thomas (the same Thomas ridiculed in the song quoted above) was highly critical of the New Deal. When asked by a reporter if Roosevelt’s New Deal had carried out the Socialist Party program, he responded famously that yes, the New Deal had carried it out, “on a stretcher.”

The New Deal reveals to us today that capitalism cannot be reformed. Even a nation-wide public works program like the size of the WPA proved completely inadequate to address the profound crisis of the Great Depression. The solution to the Great Depression was found the same way all crises of capitalism are found; through renewed accumulation on a larger scale. The second world war, the cold war, and finally neoliberal globalization have all been responses to the innate need of capital for relentless expansion. In the last few decades, this expansion has encountered planetary limits.

The result in the United States is that the system has turned on itself, and is now embarked on a course of cannibalizing what remains of the welfare state created in the New Deal period. Ironically, this makes a new New Deal more necessary than ever for capitalism. If the middle class continues to disappear at its current rate, the domestic consumer market for service industries (which is now the core of the US economy) will collapse. “The question for monopoly capitalism,” wrote Paul Baran and Paul Sweezy, “is not whether to stimulate demand. It must, on pain of death.” (p 111) US capitalism today is caught between equally pressing needs to help the working class and to devour it.

This contradiction will determine the course of struggle ahead. And while it is insoluble, as Bertold Brecht said, “in the contradiction is the hope.” A new New Deal is necessary to save the current economic and social order, even while this order militates against it. From this impossible contradiction arises the unique opportunity for the construction of a radically new social and economic order. In formulating plans of action for the immediate future, we must both learn from the past and also seize the current opportunity to transcend it. A new New Deal will not deliver us from shadow of capitalism any more than the first New Deal could. Similar calls today for the reindustrialization of the United States suffer from similar amnesia. According to the Bureau of Labor Statistics, eleven times more US workers were killed in industrial accidents during the second world war than US soldiers in combat. (cited by Boyer and Morais, p336) There is no politically simple or economically accommodating way to address the current crisis. The long walk out of crisis is a walk of revolutionary struggle larger than any yet attempted by humankind. While there is no map indicating a precise path out of today’s exceptional planetary contradictions, an acknowledgment of the path that we must walk upon and a clear headed critique of the past will be essential, perhaps in the very near future.

1 The names of other labor and political leaders whose praxis of unionism rested on collaboration with employers and the state.
2 The popularity of the (apolitical) ideas and organizing strategies of Saul Alinsky in today’s labor movement can be understood historically from this perspective.

BIBLIOGRAPHY (in order of appearance)
American Indians in U.S. History, by Roger Nichols, 2003
A New Economic View of American History, Jeremy Atack and Peter Passell, 1994
Dancing in the Dark: A Cultural History of the Great Depression, by Morris Dickstein, 2009
Hammer and Hoe, by Robin D.G. Kelley, 1990
Labor’s Untold Story, by Richard Boyer and Herbert Morais, 1955
Negroes and the Great Depression, by Raymond Wolters, 1970
Negro Liberation, by Harry Haywood, 1948
Dress Rehearsal for the New Deal: Shop-Floor Insurgents, Political Elites, and Industrial Democracy in the Amalgamated Clothing Workers Union, by Steven Fraser, 1983
False Promises, The Shaping of American Working Class Consciousness by Stanley Aronowitz, 1992
An Injury to All, The Decline of American Unionism, by Kim Moody, Verso, New York 1988
From the Folks Who Brought You the Weekend, A Short, Illustrated History of Labor in the United States, by Priscilla Murolo and A. B. Chitty, illustrated by Joe Sacco, The New Press, New York 2001
The Authoritarian State, by Max Horkheimer, [1940] Telos Press, Spring 1983
Essays on the Great Depression, by Ben Bernanke, 2000
Monopoly Capital, by Paul Baran and Paul Sweezy, 1966