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Behind-the-Scenes Opposition to the Shorter-Workweek Proposal

by Bill McGaughey


The fight for a 10-hour work day and an 8-hour work day produced the American labor movement. AFL-CIO president George Meany once said: “In effect, the progress toward a shorter work day and a shorter work week is a history of the labor movement itself.”

The present law establishing the forty-hour week was enacted in 1938 during the administration of Franklin D. Roosevelt, a Democrat. The Democratic Party cemented its relationship with organized labor during this period. One might therefore suppose that Democrats who hold elective office might be relatively sympathetic to shorter workweek proposals. Yet, all is not as it seems.

Let’s start with the idea that the Republican Party is historically opposed to the shorter workweek. Lately, this seems to be true but, going back far enough, one finds examples to the contrary. In 1868, President Ulysses S. Grant, a Republican, signed a law giving federal employees an eight-hour day. James Garfield, another Republican president, said: “We may divide the whole struggle of the human race into two chapters: first, the fight to get leisure; and the second fight of civilization - what shall we do with our leisure when we get it?”

Moving into the 20th century, President Warren G. Harding, a Republican, was instrumental in persuading steel-company executives to accept union demands to eliminate twelve-hour days in that industry. His Commerce secretary, Herbert Hoover, considered such hours to be “a black spot on American industry.” Harding’s Labor secretary, James. J. Davis, said: “Society cannot permit any industry to unmake men in order to manufacture any product.”

When Hoover became President and the Great Depression began, the proposal to reduce work hours was one of the main tools in the Administration’s proposals to reduce unemployment. He persuaded the president of Standard Oil of New Jersey (now Exxon) to tour the country urging that work hours (and pay) be reduced.

As late as 1956, we had a Republican Vice President, Richard M. Nixon, expressing support for a reduced workweek. He spoke enthusiastically of the day, “not too far distant”, when Americans would be working only four days a week, and “family life will be even more fully enjoyed by every American.” This seems to have been a youthful indiscretion on Nixon’s part. He was overruled by persons on Eisenhower’s White House staff who dismissed the speech as “an unstaffed idea.”

Another axiom in our political understanding is that businessmen or business groups have consistently opposed proposals for shorter hours of work. A stronger case can be made for that point of view, but even here there are exceptions. The billionaire automobile manufacturer, Henry Ford, unilaterally reduced, first, the work day and, then, the workweek, for his employees. He also gave one of the most lucid economic arguments ever made for giving workers more leisure. A Boston industrialist, Edward A. Filene, supported Ford’s idea of a five-day work week, calling this “a force that will bring about a reduction of waste in industry ... there will be a heavier production with costs at a point which will enable us to export temporary surpluses.”

Scholarly opinion has not treated kindly those political and business figures who supported shorter hours. U.S. Grant and Warren G. Harding are deemed to have presided over corrupt administrations. Herbert Hoover is a symbol of political ineptitude in dealing with the Great Depression. Henry Ford is reviled as an anti-Semite. To the best of my knowledge, James Garfield and Edward Filene have defied such labeling.

So how did we get to the situation where Republicans and business interests have become adamantly opposed to a shorter workweek while labor unions and Democrats offer, at best, tepid support? One would suppose that the Roosevelt administration, siding with organized labor, managed to antagonize both Republicans and business groups. At the same time, the Democratic administrations of FDR and Harry Truman did little to advance the shorter-workweek agenda beyond enacting the Walsh-Healey Public Contracts Act and the Fair Labor Standards Act.

Attitudes in the labor movement

A problem was that support for a shorter workweek within the ranks of organized labor was not as strong as one would suppose. My theory is that the Fair Labor Standards Act, enacted in 1938, provided a perverse incentive for covered employees to work longer hours in order to receive time-and-a-half overtime pay. The intent of the law was to reduce work schedules but it instead created a carrot for workers to seek the opposite.

The research director of a large AFL-CIO union commented at a 1956 conference on work hours: “Aside from the workers’ desire for their paid holidays and paid vacations, there is no evident in recent experiences that workers want shorter daily or weekly hours. The evidence is all on the other side. Hundreds of local and International officials have testified that the most numerous and persistent grievances are disputes over the sharing of overtime work. The issue is not that someone has been made to work, but that he has been deprived of a chance to make overtime pay.”

Based on personal experience, I believe that labor idealists continue to want progress in shortening work time while the bureaucrats and realists within the labor movement have bowed to the rank-and-file members who prefer overtime work to shorter hours. Tom Laney, former president of UAW Local #879, supported my efforts to promote a shorter workweek while his successor, Rod Haworth, told me frankly that the membership did not support that idea. A UAW leader at the regional level, Jerry Tucker of New Directions, was also supportive while AFL-CIO staffer in Washington, D.C., John Zalusky, who was himself in favor of shorter hours, told me that his organization could not go against the wishes of its members.

The top leaders of the AFL-CIO in the 1950s, George Meany and Walter Reuther, both voiced support for the proposal for a shorter workweek. In 1958, the AFL-CIO adopted a resolution calling for a 35-hour workweek, calling upon Congress to amend the Fair Labor Standards Act in that respect “as rapidly as possible”.

An interesting piece of testimony from a former Chairman of the President’s Council of Economic Advisors, Leon Keyserling, is that Walter Reuther, while publicly a supporter of shorter hours, was privately opposed. Keyserling said in a 1986 interview: “ When I was working closely with Walter Reuther many years later ... the labor movement started developing support for a shorter workweek, and Reuther asked me to help him oppose it. He said he just didn’t believe that the solution to the unemployment problem was shortening the workweek. He said we ought to have a shortening of the workweek only when we came to prefer more leisure rather than more work ... and our production needs were more fully met.”

Leon Keyserling’s influence

Keyserling’s testimony must be taken with a grain of salt since he was a fierce opponent of the shorter-workweek proposal. My only knowledge of Reuther’s attitude comes from an experience involving his brother. When I made an appeal for shorter hours on the floor a UAW “New Directions” convention in St. Louis in 1992, Victor Reuther, Walter’s brother, reacted with what I interpreted to be enthusiastic support.

Leon Keyserling was a legislative aide to Senator Robert Wagner in the 1930s and, as such, was able to exert much influence over early New Deal legislation. He had played a key role in drafting the National Labor Relations Act and its ill-fated predecessor, the National Industrial Recovery Act (NIRA), by which the Roosevelt administration meant to derail Hugo Black’s 30-hour workweek bill.

Keyserling admitted in a letter to Arthur Schlesinger in 1958 that “ The National Recovery Act as they [Bernard Baruch's and Gerard Swope's men] wanted it would not have included either Section 7(a) or the wage or hour or labor standard provisions. These emerged through a series of haphazard accidents reflecting the desire to get rid of the Black bill and to put something in to satisfy labor…"

Asked in the 1986 interview whether Senator Black’s 30-hour workweek bill in 1932 was “a misguided approach to recovery”, Keyserling replied: “ Yes, because I didn’t believe in sharing unemployment instead of creating jobs. The thirty-hour bill was an attempt to share unemployment by having a lot of people unemployed ten hours per week instead of a smaller number of people unemployed full time.”

Later, as chairman of the President’s Council of Economic Advisors in the Truman administration, Leon Keyserling was able to promote a policy of economic growth through military spending in the National Security Council policy document, NSC-68. It called for an increase in military spending from $13 billion to $50 billion per year, both to create an enhanced military force to counter Soviet expansion and to boost GDP. When General George Marshall complained of the waste at a 1950 cabinet meeting, Keyserling admitted that “war is wasteful and a fire engine is wasteful” but he justified this on the grounds that “you’ve got to get to the fire.” He was talking about economics, not military strategy.

After leaving his White House position, Leon Keyserling persuaded George Meany and Walter Reuther to fund a think tank, the Conference on Economic Progress, which would promote his views of economic growth rather than leisure. It was a proposal for a "full-employment" strategy based, in part, on massive government spending for armaments. As “advisors” to the labor movement, Keyserling and others were trying to steer labor off its traditional course of seeking reduced work hours.

There were others working the same angle. Keyserling’s 1958 letter to Arthur Schlesinger mentioned “Bernard Baruch's and Gerard Swope's men” names helping to shape the Roosevelt Administration’s economic policies with an eye to derailing Hugo Black’s shorter-workweek bill. Swope was president of General Electric. Baruch was a financier who had chaired Woodrow Wilson’s War Industries Board during World War I. Leon Keyserling was an economist and an attorney. Their significance here lay in their access to the President’s ear as trusted advisers, exerting behind-the-scenes influence against proposals for shorter working hours.

But these men also had an agenda which was not friendly to working Americans. A Wikipedia article on Bernard Baruch, for instance, says he believed that “Washington should control all aspects of the economy and that both business and unions should be subservient to the nation's security interest. Furthermore, price controls were essential to prevent inflation and to maximize military power per dollar. He wanted labor to be organized to facilitate optimum production. Baruch believed labor should be cajoled, coerced, and controlled as necessary: a central government agency would orchestrate the allocation of labor.”

If we want to understand how the shorter-workweek movement was derailed, we therefore need to look beyond the tripartite power structure of business, government, and labor to the influence exerted by lawyers, academics, financiers, and other “experts” in the innermost circles of power. The 1946 law creating the President’s Council of Economic Advisors had, in effect, put national economic policy in the hands of academics who were also likely to be professional economists. In the hands of economic dogmatists, this power was invariably used to defeat proposals to reduce work hours.

The Alleged “Lump of Labor” Fallacy

It may be that the shorter-workweek idea was disfavored by academic economists because the all-time best-selling economics textbook, Economics: An Introductory Analysis, written by MIT economist and Nobel prize-winner, Paul A. Samuelson, states flatly that arguments suggesting that shorter hours might ease unemployment are based on a “fallacy” which Samuelson calls “the lump-of-labor fallacy”.

Samuelson’s textbook states: “There is a .. powerful reason why workers fight for shorter hours. They fear unemployment: they tend to think the total amount of work to be done is constant in the short run ... This attitude, that there is only a fixed amount of work to be done, is sometimes called by economists the ‘lump-of-labor fallacy.’ We must give this notion its due. To a particular group of workers ... the introduction of technological change may represent a real threat .... But the lump-of-labor argument implies that there is only so much useful remunerative work to be done in any economic system, and that is indeed a fallacy.”

In fact, proponents of shorter work time do not argue that the economy is static or the amount of work is “constant”. Samuelson’s “lump-of-labor fallacy” is basically a straw-man argument. To the best of my knowledge, there are no academic studies substantiating this “fallacy” while there are, to the contrary, many rigorous studies documenting the effect when work hours are actually reduced. University of Chicago economist and later U.S. Senator Paul H. Douglas did one of them. Generally these studies show gains in employment when work time is reduced, which are partially offset by increases in labor productivity. National economies strengthen.

The pedigree of the “lump-of-labor argument can be traced back to an 1892 publication by a certain D.F. Schloss which discussed workers’ attitudes toward piece work. In the first decades of the 20th Century, the National Association of Manufacturers adapted its concept to the group’s fight against the eight-hour day. Economists such as Samuelson uncritically picked up arguments from that discussion. References to this “lump-of-labor fallacy” have now been quietly dropped from the latest editions of his textbook.

But the damage is done. Since Samuelson’s “Economics” textbook has sold over four million copies since its introduction in 1948, countless economists have been conditioned to think that only simple-minded people, such as those one might find in factories or coal mines, could possibly believe the shorter-workweek argument. It was an incredibly shabby piece of work for Samuelson to have applied the term “fallacy” to a situation that he obviously had not studied and perhaps did not understand. And now we have other economists such as New York times columnist Paul Krugman, also armed with a Nobel prize, repeating the same baseless arguments.

War or Leisure

If tendentious or ill-informed economic policy is one reason that the shorter-workweek proposal was rejected in its period of opportunity fifty years ago, another was certainly the desire for an arms buildup. One need only look at the public statements uttered by prominent individuals from that period to see the motivation.

In 1947, Bernard Baruch was crusading for a longer workweek - 44 hours - to increase national output and jobs. He said: “ "Unless we work, we shall not be able to maintain our claim to power. That would be the greatest blow we could receive, for it would strip us of our strength to preserve our way of life." To “maintain our claim to power” meant creating a huge military force that would not only “preserve our way of life” but extend it to other parts of the world.

Lyndon B. Johnson, then majority leader of the U.S. Senate, made this comment: “Frankness and candor compel me to tell you that, in my opinion, the 40 hour week will not produce missiles.” Again, work hours had to be kept long - longer than 40 hours per week - for military reasons. The United States was thought to be facing a “missile gap” with the Soviet Union - later found not to exist - and Americans had to work hard to bridge the gap.

A Democrat, John F. Kennedy, was elected President in 1960 after campaigning to close the missile gap and keep working hours unchanged despite high levels of unemployment. Kennedy told the Steelworkers union during his campaign: “In the face of the Communist challenge, a challenge of economic as well as military strength, we must meet today’s problem of unemployment with greater production rather than by sharing the work.”

Kennedy’s Secretary of Labor, Arthur Goldberg, who had previously been general counsel of the United Steelworkers union, said in May 1962: “Let me state categorically for the National Administration that the President and the Administration do not feel that reduction of hours will be a cure to our economic problem or to unemployment .... It is my considered view that the effect of a general reduction in the workweek at the present time would be to impair adversely our present stable price structure by adding increased costs that industry as a whole cannot bear.”

After years of opposition to shorter hours, President Kennedy gave indications of changing his mind in a statement he made in September 1963. He said: “ "This country is changing. We had a 58-hour week, a 48-hour week, a 40-hour week. As machines take more and more of the jobs of men, we are going to find the workweek reduced, and we are going to find people wondering what they should do." Two months later, this President was dead. One wonders what might have been.

From statements made in the 1960 presidential campaign, it is clear that political leaders thought a choice had to be made between increases in military expenditures and increased leisure for working people. Of course, they thought armaments were more important. America was then facing a military threat from the Soviet Union - mainly from nuclear-tipped missiles - and the idea of Americans taking it easy did not fit the politicians’ mood. We were always in a “race” against the Russians to gain an advantage of one kind or another.

In that environment, we had small groups of influential persons such as Keyserling promoting the establishment of a huge military machine. On the other hand, we had persons such as Dwight Eisenhower, with real military experience, warning of the danger of a “military-industrial complex”. The Arms Race won, producing new casualties and expenses and continuing obligations. So the United States became a military superpower.

In the 21st century, we see more fully what this has meant. It has meant that American corporations with business interests in Central or South America had the military muscle to protect them against popular uprisings. It meant that a group of “neo-cons” placed in influential positions within the Defense Department and elsewhere could commandeer the U.S. military machine to alter the geopolitical equation in the middle east. What it has not meant is that Americans are more secure. The U.S. military machine has given unprecedented power to small groups of ambitious insiders with access to the White House decision-making process while costing the nation plenty in treasure and blood.

This, then, is what American workers have purchased with their sacrifice of shorter hours. The political insiders know what they want from the government and are in a position to pursue it aggressively. The only force that seemed capable of upsetting the apple cart was organized labor; it had to be infiltrated and kept under control. There were always influential economists and lawyers giving advice to the unions: Give up the idea of pursuing shorter work hours.

Constituencies for and against leisure

On the other side, a core of labor idealists remains which continues to support shorter hours. There are marginalized political parties such as the American Communist Party and assorted socialist groups. There are social pioneers such as Betty Friedan, college professors such as Benjamin K. Hunnicutt and Juliet Schor, and makers of documentaries for public television such as John De Graaf.

Then there are elected officials such as John Conyers and Cynthia McKinney who have been willing to sponsor or co-sponsor shorter-workweek bills; and there are courageous visionaries like Eugene McCarthy. There are people like me out in the political wilderness. Also, there are persons who have been to Europe and seen a future that works better than ours. There are people who are just average Americans and who want and would gladly choose leisure if given an opportunity.

In the political woodwork, however, additional enemies lurk. I had a glimpse of who might be anxious to kill the idea when I once made a statement of support for the shorter-workweek proposal before a small audience that included former U.S. Congressman and Minneapolis Mayor Don Fraser. In response, he asked a simple question: Would the Federal Reserve go for this?

Again, twenty some years ago when I was invited to address a forum of the First Unitarian Society of Minneapolis on this topic, an agitated man in the audience who was employed with the Minneapolis Federal Reserve Bank rushed to the podium to offer an instant rebuttal of my remarks. Evidently he felt compelled to volunteer personally as a special truth squad to counteract the poison I was spreading.

The Federal Reserve as a player in this discussion? Aren’t they a group of men who meet monthly to set the interest rate for providing money to banks? Don’t they buy and sell government securities? Why would they be interested in regulations pertaining to work hours? There’s a lot about our system of government that I don’t understand.

I do understand that people in high places within the U.S. government generally think that the shorter-workweek proposal is a bad idea. They’ve been thinking that way for at least fifty years.

Note: The quotations and information about Leon Keyserling come from the draft of a prospective book by Tom Walker, titled “Gift of Prosperity”.

 

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