INDUSTRIAL COUNCILS SHOW EMPLOYER AND WORKER WAY TO REAL PEACE AT HOME

By Arno Dosch-Fleurot.

There is a way to peace, at least comparative peace, in industry. The warfare that is forever being carried on through the open shop, the closed shop, the strike and the lockout, is coming to be considered just as uncivilized as any other form of warfare. All that is considered necessary is the give-and-take of “industrial councils.”

The idea is being worked out in one way in England and in another way here. The English have had to come to it, forced by the fact that their factory workers are organized in industrial unions. Here it is voluntary, for the industrial workers are not organized in America. The British factory workers are organized because they are all, or nearly all, British. The American factory workers are largely foreign. In England it is a question of Englishmen dealing with Englishmen. Here it is Americans dealing with foreigners.

The British have tried to get down to a uniform system or “industrial conference,” known as the Whitley system. There it is an even game, with organization and intelligent leadership on both sides. Here the homogeneous leadership is all on one side. The industrial workers are at such a disadvantage, in the fact of their not being all Americans, that they cannot get together and hold together, like the workers of England, France, Belgium or Germany, where industrial unionism is already traditional.

American Employee Has Powers Which Boss Thinks Best for Him

The American situation is peculiar to itself. It can only be approached from one point of view, that of the employer. The employee has only so much power as the employer may consider wise to yield him. This might not seem like a very successful starting point for an idea that is supposed to be leading to industrial peace, but at that it appears to be so doing. At any rate it is a very important move in the history of American industry, and, whatever it may be leading to, it is going to have a far-reaching effect.

It may, for one thing, put an end to unionism, or render it much less important. It is pretty sure to interfere with the organization of industrial unionism, which might prove to be the road to revolution. While union leaders in England favor the idea because they can approach it on an equality with the employers, in America, union leaders fear it. Instead of stabilizing unionism as it is doing in England, here it is choking unionism out.

“Chattel-slavery,” said John Fitzpatrick, President of the Chicago Federation of Labor, when I mentioned the industrial conference. “A way to get men into such a position of humble obedience that they belong body and soul to their employer.”

What the I. W. W. has to say against it is worse. It is, whatever may be the means, easing off on the social unrest, and the I. W. W. thrives on discontent.

Big Industries Independent.

On the other side the heavy industries, coal, steel and copper, refuse to have anything to do with it. The United States Steel Corporation has not even an industrial manager. Similar great industries in Europe cannot take so independent an attitude, but here it is obvious that neither now nor in the immediate future can the great masses of factory workers get together and force recognition. They will eventually, of course, if the situation demands, but they are, on account of their lack of organization, for the time being helpless.

This makes the American experiments in “industrial councils” the more interesting. While they have been motived often by an expensive strike that set employers to thinking, the actual development of the system comes from a sense of the practical. It is also growing rapidly enough to make it appear American industry may be soon dominated by the idea. A year and a half ago there were perhaps fifty concerns working with shop committees. Now there are at least 700, and there may be many more.

Impersonal Capital.

To give a list of the important concerns is like reading the Stock Exchange list, General Electric, Westinghouse, du Pont, General Motors, International Harvester. These are concerns of a similar type. Most of the money invested is from the outside, mere impersonal capital. The managements have grown up from within the plants. The labor is in much closer human relationship to the management than the capital. If capital earns big dividends it is satisfied, but the other two elements, management and labor, live and work together every day. Once an industrial council is established reuniting the management and the workshops, it is rarely let drop. It eases up the day to day difficulties. No matter what system is used the daily contact is certain to avoid some strikes. There are three systems, generally speaking, in vogue:

To organize the industrial councils on the same plan as the Federal Government, with Senate, House and President the employees elect the House, the Senate is made up of superintendents and the President and his managers are the Cabinet. This plan is popular in the textile trades. It keeps firm control in the hands of the management.

A second plan, which also keeps the control firmly in hand is arrived at by the management asking the employees in a factory to form a “shop committee,” which will recommend, but has no vote.

Third Plan Outlined.

The third plan, the one that best expresses the spirit of the movement, provides for a joint council with definite voting powers. This council usually handles everything relating to what goes on within the factories up to and including wages. It has nothing to do with the outside business, buying or selling, and, in the final analysis, does not settle the general scale of wages. But, within the factories, under these limitations, it comes to agreement about every detail, or there is an appeal to the manager or President of the company. Arbitration boards are even provided for, but that is hardly necessary, as the whole affair is only a domestic arrangement.

All these plans are mere devices for smoothing out the daily industrial life, and have nothing to do with large economic questions. But it is extraordinary how much trouble they avoid. When it comes to a showdown they can prevent neither strikes nor the lowering of wages. That is not their importance. They prevent the misunderstandings which grow out of the lack of human contact, and experience is beginning to show that most industrial trouble comes from minor considerations.

In one case an effort is being made to utilize the idea to a far greater extent. It has been brought into use to control a whole industry, lumber, in the Pacific Northwest. The movement has a peculiar history which needs to be explained.

Handling of Migratory Worker.

The lumber workers and loggers are mostly migratory. They had no unions to speak of until the I. W. W. began working among them during the war. It met with quick response and by the summer of 1917 was able to carry on a serious strike, which the Government had to settle, as fir and spruce were badly needed in the manufacture of ships and aeroplanes. With war on, it was impossible to use extraordinary repression and make unusual appeals. Gen. Brice P. Disque, who was in command, induced an agreement by which both the employers and the employees were to leave the settlement of all labor questions, including wages, to the Government. The men agreed not to strike.

The movement got a certain momentum while the war was on, and when the armistice came, it continued to function by agreement. Its very name, Loyal Legion of Loggers and Lumbermen, indicates the circumstances behind it, but, nevertheless, it was found to be a workable arrangement. It controlled, and still controls, 75 per cent. of the lumber production in Oregon, Washington and Idaho. These three States, which produce half the lumber of the country, are divided into twelve districts, each with representatives from both the lumbermen and the loggers on an equal basis, and they settle all questions under the Chairmanship of Norman F. Coleman, President of the “Four L’s,” as the organization is called for short.

Such a body could hardly have been created without the unusual conditions of war, but its progress since is interesting. It has had to keep the good will of the loggers on a falling market.

First Crisis Is Avoided.

When I was in Oregon a few weeks ago, it had just weathered its first crisis. It was one of the principles of the organization that, regardless of the minimum wage, $4.40 per day, the “going wage” was to be determined “on the job.” In the Coos Bay District in Oregon, wages last May, June and July went to $5.30. On Aug. 1 the lumbermen asked to go back to $4.80. A district council of the “Four L’s” was held, the operators producing figures to show why wages must come down and the loggers showing the cost of living was too high to permit it. An agreement was reached by which the loggers agreed to increase production sufficiently to earn the extra 50 cents a day, and did it.

But the lumber market went steadily down and the operators appealed again for a lower wage. This time it was admitted by both sides that the price of everything would have to come down this winter to a lower level, and they would find a way to let down wages and living costs at the same time. So they called in the local merchants of Coos Bay, who agreed to the same facts and promised to make a 15 per cent. cut at once. This was sufficient to cover the cut in wages, and the only persons affected were the merchants, who admitted they had to pocket the loss anyhow.

This instance is illuminating, because it shows how far this idea can be carried and how much trouble can be avoided by men getting together with those to whom they pay wages and coming to an understanding.

Works in Unsteady Market.

If the lumber market should be bad all winter it is apparent the strain would be too great for even so elastic an organization as the “Four L’s,” but by what it has already done it has proved what can be done by human contact. If it can work at all in the lumber industry, which is subject to a very unsteady market, it could certainly work in any other industry. Nor is lumbering a kid-glove industry. The average lumber operator is a plunger, and until the “Four L’s” got started it was always a question of whether the operators were going to “break the back” of labor or whether the loggers were going to “break the back” of the operators.

None of the concerns which have seriously adopted the “industrial council” system pretend they have solved everything. They say they are simply restoring the human relationship which was lost through the growth of industry. They pretend to have found no new principle. Some go in for profit-sharing as a stimulus, others say it is not desirable. That is a matter of opinion. The important consideration is the spirit with which the problem is approached. The mere fact that the management of a factory wishes to introduce such a system would indicate it has not a pinchpenny attitude. But those who oppose it, mostly labor leaders, hold that it is a farsighted scheme to get a bunch of faithful slaves who acquiesce in the smooth arrangements prepared in council, so that they become wage-slaves of the most hopeless kind. They also say, and with justice, that the system removes the incentive for joining labor unions, and, even though the management plays perfectly fair with union men, unions wither up and die, as they get no nourishment.

Makes Men Feel Safer.

At the rate at which the “industrial council” idea is catching on it can be safely predicted that it is going to interfere with the growth of industrial unionism which would otherwise begin to show itself. It has a tendency to make men feel surer of their jobs, which induces them to buy homes and unite their destinies with the industries they serve. It makes them feel they have a stake in the industry. If the spirit behind the movement is wrong this could, as Mr. Fitzpatrick said, lead to a sort of chattel-slavery. But I have noticed in the few plants with “industrial councils” which I have been in that there was a spirit of service. I notice that the bigger American plants have become in a sense institutions, they have a code of conduct developed out of the special world which the institutions create. The people who get the dividends are far away, but the management and the plant are in intimate daily contact.

As I wandered through these plants, each with its own life, it occurred to me that within these plants was developing what the modern sociologists call the social conscience. If it has not such a spirit it does not succeed. The calculating employer who is only pretending mutual interest will not get the service in return.

These same modern sociologists hold that the present era is chiefly remarkable for having created the individual conscience, and the next era will produce the social conscience. They point to Russia and maintain that the theories of Lenine develop the social conscience. Any one will go so far as to say that a social conscience is necessary if Lenine’s ideas are to have a fair show. It would be ironic if the social conscience were to develop quicker in the despised American bourgeois republic than in Bolshevik Russia.