What Makes Reuther Big

September 9, 1957

Walter P. Reuther, head of the United Auto Workers Union, has always been an adroit politician and propagandist, but his latest proposal to the three major motor companies is his masterpiece. It devotes 21 eloquent paragraphs to declaring that inflation is a bad thing and that someone should do something about it. So here’s the scheme. Let the automobile companies cut their profits. Let them reduce the prices of 1958 models “to levels averaging at least $100 below” 1957 models. In return, though his UAW will still presumably demand “the biggest wage increase in the history of the union,” he promises to give “full consideration” to the effect of the price reduction on the corporations’ earnings “in the drafting of our 1958 demands.” Such sacrifice is breath-taking.

It may be, however, that Reuther’s proposal will prove a propagandistic boomerang. The heads of the three big automobile companies have all made effective replies. Harlow H. Curtice of General Motors has pointed out that the straight-time hourly wages paid by GM have increased 72 percent since 1947, though the cost of living has gone up only 25 percent. He has also called attention to the “unmistakable similarity” of Reuther’s current proposal to the “publicity maneuver” that Reuther used during his union’s 119 day strike against GM in 1945–46. Then also he insisted that GM could lower the price of Chevrolets by $100 and still grant his wage demand. Then also he demanded that the company “open the books” to prove or disprove its “ability to pay.” And, as Curtice unkindly points out, Reuther also publicly admitted only a few days after the settlement of that 119-day strike that “the whole question of producing the books was merely a public-relations job on our part” to put the company “over a barrel.”

CUT WAGES FIRST?

L.L. Colbert, president of the Chrysler Corp., correctly characterized Reuther’s proposal in his own reply: “While you propose that we absorb all cost pressures already put upon us and ahead of us and, in addition, reduce the price of our 1958 cars, you merely offer to take into ‘consideration’ the financial effect of the proposed price reduction when you confront the automobile industry with your 1958 demands, which you have described as ‘the largest package we’ve ever demanded.’ Would it not be just as logical for the automobile industry to ask the members of the UAW to take an immediate and sizable wage cut, which the companies would then ‘take into consideration’ in pricing their 1958 automobiles?”

Henry Ford II, finally, for his own company, points out that since 1948 Ford wages have gone up 70 percent while the price of the 1957 Ford, “a far superior product to its 1948 counterpart in every respect,” has gone up only 30 percent—“less than half as much.” And Ford sums up: “Thus, having poured gasoline on the fires of inflation, you now stand by and tell us how to fight the blaze.”

THE MEAT HE FEEDS ON

It is easy to prove that Reuther’s proposal is an empty propaganda gesture, wholly without practical merit. It is perhaps more important to ask how it comes about that a single labor leader has acquired the power which this arrogant proposal reveals. The answer is simple. He has this enormous irresponsible private power because Congress has conferred it on him.

The automobile companies are rightly prohibited from combining to fix their prices against the buying public. They do not dare even to negotiate as a unit with Reuther. But he is aided and abetted by the law to monopolize the labor of the entire industry. He is free to play the automobile companies against each other by pulling a strike in one and not in its competitors. The auto companies, on their side, are compelled by law to bargain exclusively with his union, no matter how unreasonable its demands or how insulting its tone. The Norris-LaGuardia Act and the Wagner-Taft-Hartley Act are the meat upon which this our Walter feeds that he is grown so great.

This is the situation to which the Administration and Congress remain persistently and willfully blind. Their impotence is self-imposed.