What was the “corruption” that Jefferson loathed?
Name three projects Hamilton started as Secretary of the Treasury that backfired. Why did these ideas fail? Explain.
Who is Ned Ludd and why is he remembered?
What did England’s Combination Acts of 1799 and 1800 achieve? What changed in 1825?
What is the Napoleonic Code? Name five freedoms that the Code protected that also align with freedoms enjoyed in America today. Did the Napoleonic Code make a lasting change in Europe? What aspects of the Code are still present in Europe today?
Who is Robert Owen and why is he remembered? How did he make his first fortune?
According to Owen, what is responsible for how a man or woman develops and takes on traits, virtues and work ethics? What did Owen think about the influence of religion on people?
What village did Owen set up in 1825? Where? How many families joined?
Which of the seven pillars of socialism did Owen set up to run the village? What three things did he specifically abandon to establish his utopian society?
What did Josiah Warren, a member of Owen’s utopian village, say that Owen taught them about Communism? How long did the experiment last? According to Warren, what eventually conquered the village?
Part IX--REVOLUTION OF THE SOCIALISTS, Part: 2
“When virtue suffers neglect and death, the historian knows an end to the whole is not far behind.”
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355 Quoted in The History of Co-operation in England, by George Jacob Holyoake, 1875.
356 Quoted in Joshua Muravchik, Heaven on Earth: The Rise and Fall of Socialism, p. 37.
357 Ibid., Muravchik, p. 37.
358 Robert Owen, from a speech delivered August 21, 1817, an extract of which is included in “The Parliamentary Debates,” Vol. 41 (Nov. 23, 1819 to Feb. 28, 1820), p. 1201.
359 Steven Pinker, The Blank Slate: The Modern Denial of Human Nature, pp. 287-88.
360Josiah Warren, The Motives for Communism—How It Worked and What It Led To, Woodhull and Claflin’s Weekly, IV, 15 (Feb. 24, 1872).
361 Josiah Warren, Periodical Letter, II (July, 1856), pp. 55-56.
362 This is a paraphrase of Josiah Warren’s quote, “It appeared that it was nature’s own inherent law of diversity that had conquered us...” Ann Caldwell Butler, “Josiah Warren and the Sovereignty of the Individual,” Journal of Libertarian Studies, Vol. IV, No. 4, Fall 1980.
Chapter 58: Revolutionary: Union Organizers
Circa 1740-2010
After a thousand years of looking for an easier way to make a buck, the guilds finally found traction in the form of trade unions in the 1800s.
One of the intriguing legacies left by the guilds (Chapter 28) is their ingenious strategy of organizing themselves with government control in such a way that other people were not given the fair opportunity to participate or compete. In the free market, competition pushes prices lower and ignites the creation of better quality or new inventions—that’s how a civilization grows. But the guilds had complete control over pricing, availability, value, and quality. They held a firm grip on the market of try, buy, sell, and fail.
The guild system seemed to work pretty well for a while. They became powerful small-business associations, or cartels. Small towns benefitted enormously from their local guilds and zealously protected all the sources of revenue the guilds helped generate. Town leaders passed laws favoring the guilds, and helped them preserve the secrets of their trade—an early form of patent and copyright protection.
Decline of the Guilds
With the passage of time and the growth of populations, the tables turned against the guilds. People started blaming guilds for having too much control, for stifling innovation and business development, for preventing technology from advancing, and practicing a form of nepotism by benefitting only their friends and relatives in other communities. The guilds also ignited fights over sales territory. The fighting and control turned towns against villages and cousins against relatives. It was bad public relations for the guilds, and helped lead to the guild system’s eventual collapse.
Were Guilds Forerunners of the Labor Unions?
Modern scholars debate whether or not there exists a direct connection between guilds and modern trade unions. Whatever the technical definitions are that create such debates, to an outsider it seems fairly clear that guilds led to unions.
Like unions of today, the guilds united craftsmen into what amounted to an exclusive members-only club. For example, with all the skilled shoemakers in a particular region strongly united to create only so many shoes in a week, and demanding a sales price of so much money per shoe, and setting standards of skill so that only so many shoemakers were servicing a population, they could control the shoe market and get rich.
Pro-labor Politicians Not New
That exclusive control across hundreds of crafts and services was further entrenched when pro-guild candidates ran for election. Those who won office carried forward the guilds’ agenda into town hall to pass pro-guild laws: lace sold in this town must be made with locally produced thread; shoes sold in this town must be made of local leather; candles sold in this town must be made with locally produced wax and wicks, etc.
To the guild members this was fantastic progress. To everyone else, it made life more restricted. And to competitors, it was the loss of the liberty to compete.
Minority Becomes the Ruler
The labor movement in the 1800-1900s had similar goals and tactics as did the ancient guilds. Most histories of trade unions list a time-line of strikes and violence, and show how the courts and society gradually accepted the unions as if they were necessary components of progress.
In the beginning, only a minority typically joined a union. The unions were led by a small group of leaders. The select groups, with the strong backing of the government, demanded that the rest of the industry, the country, and the world obey their commands.
Unions are ‘Socialism in the Workplace’
From the perspective of the spread of socialism, union “milestones” in history do not represent progress—they represent battles won in the war to take away property rights of business owners. As unions gained more power, so did the laws that protected their actions on all fronts. Unions constituted the socialization of a nation—as unions grew, so did socialism.
Like the Guilds: Trade unions organized themselves to restrict or prevent competition. They gained the legal power of the strike or the walk-out to force their demands. They created exclusive markets and centers of production. They illegally confiscated advantages with the backing of legal entities. It was, in short, the imposition of Ruler’s Law in the marketplace.
Colonial Unions
By the mid-1700s, there was already a good working relationship among employers and employees throughout the colonies. Walk-outs and strikes in this early setting were viewed more as greedy conspiracies that fostered antagonisms than as the means to bargain over wages or working hours.
In 1740, bakers in New York City went on strike. They refused to bake until they received a pay raise. The constables arrested the strikers and charged them with conspiracy to ruin the otherwise honestly-run bakeries.
In 1776, New York City was occupied by British troops and the young country was in the very throes of declaring independence. With newspapers owning the Goliath portion of communications in those days, printers had a lot of clout and influence in all the major cities. The New York printers decided they deserved a wage increase, and demanded it. The employers refused, so the printers went on strike to get their raise.
In 1794, an association of printers in New York went on strike for shorter work hours and higher pay. The same demands were made by cabinet makers in 1796, carpenters in 1797, and cordwainers (shoemakers specializing in soft leather)
in 1799.
By the 1800s, the idea that workers could gang up on their employers was widespread and popular. It became the most effective means whereby workers could garner some degree of leverage against employers whom they believed were abusive, or to otherwise extract treatment they considered more fair or more safe.
In 1803, the Sailors’ Strike enticed sailors from all over New York to march through the city to encourage sailors from other ships to join them as they demanded higher wages. Although the crowds swelled, the leader was arrested and the strike failed.
In 1805, the Shoemakers’ Strike in New York and Philadelphia was the first time the factory owners turned to the courts for relief. The Journeyman Shoemakers’ Association launched a strike to raise prices from 25 cents to 75 cents per shoe. The strike dragged on for six weeks. The leaders were finally arrested and prosecuted for criminal conspiracy. The jury declared the union members to be guilty of “a combination to raise their wages.”363
In 1809, New York cordwainers went on strike for better pay. During the strike, the bosses slipped away with the shoe-making materials to other shops where non-strikers would finish the work, thereby defeating the strikers’ strategy. When the strikers discovered what the bosses had done, almost 200 men joined in a new strike in an attempt to shut down all the shoe-making shops.
In 1827, workers in several diverse occupations were invited to join together in the Mechanic’s Union Trade Association. The goal was to give a unified setting and airing of all mutual concerns, regardless of trade or specialty. Supporting and backing strikes together carried more support and additional pressure tactics. Other associations and unions were encouraged by the unified effort. Strikes Increase: The number of strikes in the first 35 years of the 19th century grew so rampant and widespread in America, the strikers starting behaving as if this was standard procedure to get pay raises. Union leaders advertised their newly-found ‘easy pickings’ by advertising the possibilities in the newspapers. In 1835, The New York Daily Advertiser boasted that strikes “are all the fashion,” and encouraged others to get in on the action, saying it was “an excellent time for the journeymen to come from the country to the city.”364
Crossing the Line and Changing the World
In 1842, the Massachusetts Supreme Judicial Court broke the last chain preventing socialism from entering American labor when it declared that labor unions were not criminal conspiracies.
At issue was the Boston Journeymen Bootmakers’ Society that tried to force boot factories to hire union members only. In modern terms, they tried to create a closed shop.
In 1839 the bootmakers went on strike for a closed shop, and the strike leaders were arrested on charges of conspiracy to restrain trade. The lower court found them guilty, but the union appealed to the State supreme court. Chief Justice Lemuel Shaw identified their constitutional right to assemble, but only if they never used force to get their way.365
The shaky ground on which Shaw made his ruling was this: unions have but one purpose—to use the force of the strike to get their way. Shaw’s ruling was contradictory. Can an institution founded on the use of force and created to violate the rights of owners be made legal so long as it doesn’t use force, or violate the rights of others?
Shaw declared that the union could exist regardless of its purpose (seeking a closed shop) or the means whereby it would seek those ends (the power to strike).
The ruling gave unions a legal foundation to exist. That’s all they needed to launch strikes and make other demands for control across multiple issues and multiple decades.
Unions More Important Than Property Owners
Since the 1842 Bootmakers case, the courts have given legal teeth to widespread union organizing, even when business owners don’t want that on their property.
Strikes Made Legal: In 1914, the Clayton Antitrust Act366 gave unions the legal permission to conduct peaceful strikes, to picket, and to boycott.
Can’t Prevent Unions: In 1932, the Norris-La Guardia Act prevented business owners from going to the courts to stop union organizing in their companies. If workers wanted to join a union, owners could do nothing to stop it. Union organizers were given legal permission to trespass on private property, and to peacefully pass out pro-union literature.367
Loss of Freedom to Negotiate: In 1935, the National Labor Relations Act forced workers to let unions set their wages and benefits. Workers and employers could not make their own contracts at union-controlled businesses without the blessing of the union.368
Interstate Commerce Clause Violated: In 1937, the Supreme Court broke a major chain binding down Congress. There was a steel plant that manufactured goods in Pennsylvania. When the unions tried to organize its workers, the company fired them. The workers sued, saying the National Labor Relations Board had jurisdiction, but they lost in the lower courts. When the case reached the Supreme Court, that’s when the damage was done. The problem was that Congress and its NLRB only had constitutional authority over trade between the States. The steel plant issue was inside Pennsylvania, and it did not extend to other States.
Justice Hughes said even though the company didn’t engage in trade outside the State, its close relationship to those that did meant Congress and the NLRB could indeed control them. The court ordered the company to rehire the ten employees and give back their lost wages.
The justices who disagreed said Congress shouldn’t be allowed to interfere with a company that was just in-state.369 The dissenters were outvoted 5-4.
This decision warped the restrictions in Article 1.8, the so-called Commerce Clause that restricted congressional powers. Without amending the Constitution, the Court gave Congress the power to control intrastate businesses if unions wanted to organize there.
Violence and Damage is Legal: In 1972, power company union workers who were striking for higher pay shot bullets into three electric transformers, drained the oil out of another, and dynamited an electric company substation. The Supreme Court said this was okay because the union had a legitimate claim to higher wages, and destroying property was acceptable in pursuit of that claim.370 Violent acts against a business, including assaults, destruction of property, and even murder, are not punishable under federal law, but they can be punishable under State law. In the 25 years after that 1973 ruling, there were 8,799 incidents of violence recorded, but there were only 258 convictions.371
Union Force Ruins Prosperity: In 2007, just as another U.S. recession was beginning, the American auto industry was screaming for help. Instead of cutting back and going through a self-imposed austerity program, the unions held firm, threatening to bankrupt the major U.S. auto makers if they didn’t comply with union demands. And that’s just what happened.
Unions Bankrupt Their Hosts: As unions use the strike to compel wages and benefits to go up, a company or city’s surpluses that might otherwise be used to invest, modernize, and expand are instead diminished. This makes them less competitive. Businesses saddled with aggressive unions often respond to union victories by reducing the work force, outsourcing, or closing plants for good. This is not a beneficial deal for workers who otherwise might work for less. Given enough time and power, unions, like socialists, will destroy their hosts. Hostess (Twinkies, Ding Dongs, Ho Hos, etc.): About 80 percent of its 19,000 workers belonged to a dozen different unions. When Hostess fell on hard times, it tried to amend its contracts with the unions to reduce pensions, medical benefits and restrictive work rules that cut into profits. Some unions wanted to help, but others did not, and the company had to close its doors in 2012.
“Big 3” Automakers: When Detroit’s automakers controlled a monopoly over car production, they could afford to acquiesce to costly union demands. And then came foreign competition—better cars at lower prices. This required change. However, the tight marriage between unions and the Democrats in government prevented the automakers from trimming back union demands. Cost per car stayed high. The companies res
ponded by dropping quality to keep prices low. People stopped buying those unreliable products. Foreign car makers took bigger chunks of the market, and today, the once vibrant motor city in Michigan sits rusting with its hood up and the engine gone.
American Airlines was losing almost a billion dollars a year for the decade of 2001-2011. During this period labor unions were pulling out $800 million a year more than other airlines’ unions. They had demanded better pay, work rules, pensions and benefits. Strikes loomed everywhere each time the company tried to trim costs—flight attendants, check-in clerks, baggage handlers, cabin crews, pilots, mechanics, and suppliers said ‘don’t touch our contracts.’ The result? The company filed for bankruptcy in 2011. And what about the unions? They sued.
Detroit: This city is a wreck. For decades, union demands chipped away at Detroit’s prosperity. With wages and benefits higher than market levels, thanks to the prosperity of the auto industry, the unions drove up costs on just about everything. City services were unionized, and taxes had to rise to meet those costs. It was unsustainable and discouraging. People started moving out, reducing Detroit’s population from 1.8 million in 1950 to about 700,000 in 2013. By then, total unemployment was over 50 percent. Detroit’s bloated and inefficient government stood blamed for shattered morale, 47 percent of the population being illiterate, 40 percent of the street lights not working, police taking an average of 58 minutes to respond, only 1/3 of the ambulances running, and 2/3rds of the parks closed since 2008. In all of this, the unions insisted that a city horseshoer making $56,000 was critical to the city, even though there were no horses in Detroit.372 That’s socialism at work.
Unions successfully advance their socialist causes until they run out of other people’s money, and then they loudly complain.
The Naked Socialist Page 31