The Hamlet Fire

by Bryant Simon

  I.W. Abel, the president of the United Food and Commercial Workers Union, called OSHA a “giant step forward.”5 He compared the law to the Wagner Act, the landmark legislation signed into law by President Franklin Roosevelt in 1935 that protected the rights of workers to strike, organize, and collectively bargain. But OSHA did more than give workers new rights; it seemed to require new responsibilities for employers, obligating them to reduce the risks of illness and injury on the job regardless of the cost. In addition, it gave the Department of Labor the power to make sure that employers complied. OSHA, wrote the presidential historian H.W. Brands, summing up the potential impact of the law, “put . . . the federal government’s nose into the offices of nearly every employer in the country.”6

  Few American politicians were more calculating than Richard Nixon was. At first glance, OSHA looked like an impressive extension of the New Deal and a noteworthy case of a Republican bolstering the regulatory state and expanding the powers of the federal government. To be sure, Nixon never belonged to the staunchly anti–New Deal wing of his party. He didn’t shy away from government solutions to problems, nor did he consistently deliver long speeches on the virtues of the free market. But Nixon never stopped scheming or adding up votes, and he never thought an election was in the bag, even when he held double-digit leads in the polls. In the early 1970s, as he got ready for his re-election run in 1972, Nixon wanted the support of the growing Goldwater wing of his party. He wanted them to think he was one of them. Looking to connect with the burgeoning conservative movements stirring within the GOP across the country, the president talked about the need to restore authority to the states. He called his plan New Federalism and promised to direct money and power away from the federal bureaucracy and “back” to states, counties, and municipalities. The plan struck a chord with traditionalists, especially hardline segregationists in the South—another group close to Goldwater that Nixon wanted to bring into his fold—clinging to notions of states’ rights in the face of civil rights gains and the movement of African Americans into the Democratic Party.

  A key section of the original OSHA law embodied Nixon’s New Federalist promise. Under this provision, individual states were allowed to form their own state-run worker safety agencies. While these agencies were supposed to uphold federal standards, they remained in the hands of state officials, who could stipulate their own fines and punishments.7 A few states, like California, opted to do more for their workers than the federally mandated plan called for, so they set up their own state-managed workplace safety agencies. Most states that adopted the state-run plans, like North Carolina and its southern neighbors, set up their programs to do less for laborers. Less, they were convinced, would keep them competitive in the never-ending industrial sweepstakes and allow them to lure factory owners, like Emmett Roe, dogged by federally employed OSHA regulators in Pennsylvania, to their borders. The New Federalist sections of the OSHA law explain, in part, how North Carolina slipped to last in the country in its ratio of safety inspectors to workplaces by 1991 without penalty and how this lapse would, in turn, put pressure on other states to cut safety corners so they could lure new businesses to their towns and cities in yet another rotation of the cycle of cheap.

  In the 1972 campaign, Nixon wasn’t only pursuing the votes of Gold-waterites and southern state’s rights advocates. He had an even larger ambition. He wanted to pull white workers, union men in hard hats and steel-toed boots—the same men captured in famous photographs using flags to battle against anti-Vietnam protesters in New York City—away from the Democratic Party. He began courting them in 1968 with promises of law and order and opposition to “forced” busing. OSHA represented another part of that pursuit, a political gift to laborers. But Nixon’s appeal to construction workers and plumbers proved, probably not surprisingly, to be more show than substance.

  From the very start, OSHA never got the funding it needed, so it never became a vigorous regulatory presence on the shop floor. It remained vulnerable to budget cuts and the political whims and attacks from business interests and supporters of cheap government. But, at the same time, it did serve as a promise—a promise of government-guaranteed workplace safety, and many in labor circles after 1970 went about holding employers and state and federal agencies to the letter of the law.

  Germans call the rules and careful balance between abiding by the law and punishment for transgressions ordnung, or order. For OSHA to work, it needed ordnung, the same kind of ordnung that allowed for the smooth operation of German subways, buses, and trams. There are no ticket takers, tokens, or swipe cards on Berlin, Munich, or Frankfurt public transportation. Yet, because inspections are random and unannounced, most adult customers pay to ride from one part of a city to another. If officials catch someone without a ticket, they remove him or her from the train, sometimes in full view of others. Usually, they issue warnings when they nab a non-paying passenger the first, and even the second, time. After that, it becomes a criminal offense. Violators can end up in court and face stiff fines and, in extreme cases, prison sentences. Even more crucially, most Germans acknowledge the value of their transport networks. They understand the need to comply, pay their fares, and help to underwrite the system as a contribution to the larger public good.

  Unannounced inspections maintain order by keeping would-be slackers on their toes and playing by the rules. The same idea underscored OSHA. Inspections would determine whether OSHA really did stick the government’s nose into business operations and decision making. For the law to work, inspectors had to be on the front lines. There had to be enough of them, and they had to threaten employers with enough surprise visits so that managers and bosses didn’t know when they were coming. When they did come, they had to have the authority to punish lawbreakers with stinging fines and even jail sentences.

  Across the country in 1991, however, OSHA employed a mere 1,300 inspectors for 7 million workplaces. That translated into one inspector for every 4,666 job sites. If every safety official knocked on the door of one business every day, it would take him twenty years to visit every supermarket, slaughterhouse, machine shop, and factory in his portfolio. In North Carolina, as the NBC journalist Robert Hager and others learned after the fire, the ratio of industrial sites to inspectors was three and half times the national average. That told Emmett and Brad Roe and other businesspeople in the state that the system posed only the faintest threat to their prerogatives to run their factories any way they saw fit.8

  When OSHA officials did issue a fine, it didn’t cost employers much, in monetary terms, inconvenience, or social standing. Nationally for the period from 1972 to 1990, the median fine collected in accidents that killed or injured workers on the job was less than $500. The original law that allowed states to establish their own OSHA operations also allowed them to set their own penalties. That’s why, over the same time span, the median fine in 470 cases investigated in North Carolina was $395, the eleventh lowest in the country. By contrast, in Pennsylvania, where Imperial operated for much of the 1970s, the median fine reached $640. But even that didn’t amount to much more than a rap on the knuckles for firms that ordered steel by the ton and chicken parts by the truckload.9

  Worst of all for worker safety, OSHA suffered from the start from a case of bad economic and ideological timing. President Nixon rolled out the program in the waning days of the American Century as the United States economy ended two and half decades of robust and broadly shared growth. No one, not even the experts, saw the end coming. In fact, most mainstream economists and policy makers said what happened couldn’t happen. “Prevailing Keynesian economic thinking,” writes the historian Michael Stewart Foley, “suggested that unemployment and inflation would never rise simultaneously, but in the early 1970s they did, and a new phenomenon—‘stagflation’—appeared.”10 The impact was immediate. Foreign competition jumped. Companies cut wages, laid off workers, and shut down hulking and aging industrial plants, especially in union strongholds. At the same time,
the price of goods, led, of course, by oil and gasoline, rose steadily and kept rising faster than most people’s by then sluggish wages. After accounting for inflation and taking out taxes, in July 1981 the average American had 9.7 percent less to spend than a decade earlier.11

  Presidents Nixon, Ford, and Carter promised to curb inflation and restore well-paying jobs and lost income. For a time, each pursued a variation on the theme of New Deal–inspired spending solutions, mostly wage supports and price controls. Nothing seemed to work. Business profits kept falling. Tax revenues waned. Inflation and unemployment remained alarmingly high. The failure to push wages and employment rates back up to their postwar levels made cheap consumer goods and foodstuffs, and the ideas behind a reversal of Fordism, more valuable, appealing, and necessary than ever before. But, even more, the persistence of economic uncertainty opened the door for new ideas about the scope of government activity and the basic social contract.12

  The inability of presidents and lawmakers to quickly reverse the course of stagflation eroded faith in government as a credible problem solver, a faith that had already been rattled by the lies of Vietnam and the deceptions of Watergate. As more and more Americans faced reduced wages and surging inflation, Republicans and moderate Democrats started to listen to traditional conservative critiques of New Deal thinking and deficit spending. Struggling to keep small businesses going and make mortgage payments, many became increasingly receptive to the notion that government wasn’t the best or only solution to pressing social and economic problems and might, in fact, be part of the problem, and that raising aggregate consumer demand wasn’t the answer, but cutting costs and taxes (their taxes) might be. Many became convinced that the government no longer facilitated growth but rather held back the economy by taking too much out of the paychecks of hardworking people and putting it into the wrong hands. More business, less regulation, and fewer unions, they started to think, could decrease prices, create more jobs, and cure the country’s economic ills. “This argument,” explains the historian Rick Perlstein, “was precisely the opposite of Keynesianism,” which is that higher wages and more government protections benefited everyone. It wasn’t just businesspeople or policy wonks at conservative think tanks in California or free market economists at the University of Chicago who were thinking this way. Throughout the mid-1970s, store owners, small manufacturers, farmers, and independent truck drivers came to similar conclusions on their own, even before they heard Jimmy Carter and Ronald Reagan groan about red tape, union bosses, runaway inflation, and government interference.13

  Because of its direct costs to employers and its role in workplaces across the country, OSHA turned out to be critical in changing the minds of many Americans about the larger issues of regulation and government involvement in the economy. “Over the decade of the 1970s, OSHA, along with the EPA—Environmental Protection Agency, which was also signed into law by Nixon during his first term in office—came to symbolize the evils of big government,” James Smith, an official with the United Steelworkers of America, told a reporter in 1981. “This, in turn,” he contended, “made the agency a prime target for the regulatory reform that will somehow make our country great again.”14 As early as 1972, an official from the National Association of Manufacturers complained about OSHA’s “massive regulations.” “It impinges,” he contended, “on almost every aspect of day to day operations of business to a greater extent probably than any other law on the statute books.” The conservative publication Human Events labeled it “the chief federal harassment agency,” claiming that its rules made it nearly impossible for small businesses to function and hire new workers. OSHA has become, a Harvard economist remarked, “perhaps the most prominent symbol of mis-guided regulation.” The costs of OSHA, maintained a New York City consultant, added up to “about 10% of our income.” “It is about time,” he concluded, “that the fool regulations and meddling by government should stop.”15

  From the start, corporate interests had opposed OSHA. But new resistance stirred by the latter half of the 1970s and into the 1980s. According to the historian of “the businessmen’s crusade against the New Deal,” Kim Phillips-Fein, the mounting opposition to OSHA represented “a first step in a broader campaign to challenge the system of government regulations.” Pushing back against the agency turned scores of middle-class Americans, and not just employers, into converts to the idea that a pro-business government could grow the economy, create new jobs, and keep prices down for everyone, and that this represented a better course of action than extending the New Deal or the Great Society. Increasingly, OSHA’s opponents defined worker safety not as a right, as labor leaders had tried to make it since the 1960s, but as a factor in a cost-benefit equation that had to be balanced against the freedom of the market and its ability to deliver cheap goods, ample jobs, and steady profits. If a regulation absorbed business profits, by this way of thinking, it needed to come off the books because the most essential role of government was to clear the path for economic growth, not to create social security or protect ordinary Americans. Business became, in a sense, the new voice of the public interest, but in its 1970s incarnation it no longer stressed the relatively high wages that it paid to workers. Instead, it highlighted the bargains it provided to shoppers. In this way of thinking, OSHA became an enemy not just to industry, but to everyone concerned with kick-starting economic growth and providing consumers with cheap essential goods.16

  The pushback against OSHA came just as the American labor movement began its long, slow retreat in the South and everywhere else in the country. Union membership in the United States peaked in the 1950s at 35 percent of nonagricultural workers and then held steady at around 30 percent for the next two decades. In 1971, unions represented 27 percent of the nation’s workers. The collapse of manufacturing, rising competition, and the expanding geography of cheap—where companies relocated to out-of-the-way places like Hamlet with swelling pools of labor and limited employment options—cut deep into the American trade union movement. At the same time, inflation jarred mainstream social thinking. For much of the postwar period, unions and the burgeoning middle class stood together in favor of higher wages. But the government’s inability to control inflation led shop owners and office workers to adopt new ways of thinking. Many started to blame unions for the sharp rise in prices, which was fueled, they argued, by bloated paychecks for blue-collar workers along with generous pensions and health benefits. As most people pointed to unions as a problem, they started to look to business to address the nation’s economic challenges.17

  As business got assigned the role of the nation’s chief economic engine and therefore a force for social good, organized labor got framed as a special interest. Ronald Reagan, the former president of the Screen Actors Guild, hammered the point home in his first days in office. When the country’s air traffic controllers defied a court order and went out on strike protesting low wages and unsafe working conditions, he fired them, telling the media, “There is no right to strike against the public safety by anybody, anywhere, at any time.”18 From that moment on, labor fell back on its heels, increasingly unable to check the ideological surge in favor of less government and lower prices that eroded support for decent pay and worker safety. By 1991, unions represented only 15 percent of the nation’s workforce. Only a fraction of that number of laborers were in the South and West, where industries rushed to relocate in the postwar years and take advantage of access to cheaper labor and cheaper raw materials.19 Weaker unions meant a weaker voice for labor on the shop floor and in the public debate over wages, regulations, and worker safety.

  Middle-class North Carolinians joined the grassroots pushback against OSHA, unions, and the larger commitment to a government-built and-maintained safety net. Rocky Mount businessman Michael Amstray complained in the mid-1970s about OSHA’s “Gestapo powers.” He asked Governor James Hunt, the state’s leading pro-business Democrat, to abolish the regulatory agency and bring an end to its “ineffective and un
necessary reign.” A cardboard box manufacturer from a nearby town called OSHA “nit picking and counter-productive.” Stephen Vickery of Morehead City added that OSHA and its fines threatened to put his feed mill out of business and his employees out of work, making them a drain on the local economy. That put him squarely on the side of deregulation, the same side as James Larkee, an Arden resident who called OSHA “a direct violation of the constitution” that placed “unreasonable financial burdens on the business and industry of our country.”20

  Charlotte lawyer and Republican Party activist Hugh Joseph Beard Jr. described OSHA as “the capricious power of a runaway, oppressive bureaucracy” that “victimized” business owners and their employees. Endless paperwork and rough interrogations, he said, turned mill owners and shopkeepers into “second class citizens.” Vowing to fight for the “individual freedom and liberty” of those oppressed groups, in 1978, Beard initiated litigation challenging the North Carolina OSHA law. He told supporters that the agency’s “unwarranted inspections” violated the rights of employers and constituted “unlawful government activity.”21

  As Beard built his case against North Carolina OSHA, he reached out to leaders of the American Conservative Union (ACU). A year before the Charlotte lawyer went to court, the ACU had launched a larger national Stop-OSHA campaign. Railing against the agency’s “overweening power,” the conservative umbrella organization founded in 1964 by William F. Buckley and dedicated to the principles of personal responsibility, a strong national defense, and the idea that “capitalism is the only economic system of our time that is compatible with political liberty” sought to “abolish OSHA or dramatically overhaul it.” Searching for recruits for its deregulatory counter-insurgency, the ACU assembled a list of business owners fined by OSHA, addressing its letters to them, “Dear Victim of OSHA.”22