Chapter Seventeen: A.F. of L. Class Collaboration During the Coolidge "Prosperity" (1923-1929)

17. A.F. of L. Class Collaboration During the Coolidge "Prosperity" (1923-1929)

The Foster/Gitlow Communist Party
Presidential ticket of 1928.
 Gitlow would later leave the Party and
became conservative and anti-Communist.  
The period from early 1923 through most of 1929 was one of industrial expansion and capitalist prosperity for the United States. With ups and downs, the "prosperity" lasted practically all through the presidency of the Yankee skinflint and police strikebreaker, Calvin Coolidge, as well as during some six months of the term of the "great engineer," Herbert Hoover, imperialist exploiter of colonial peoples. It was a time of speculation and capitalist arrogance, until finally, in October 1929, the whole dizzy economic edifice went crumbling like a house of cards in the greatest economic crisis in the history of world capitalism.

American industry, fed by the red blood of war, increased its production from 1913 to 1929 by 70 percent.1 "By 1928 the total volume of (U.S.) production exceeded the production of the whole of Europe."2 The production of passenger automobiles, the bonanza industry, went up from 895,930 in 1915 to 4,587,400 in 1920, and trucks from 74,000 to 771,000. The production of gasoline increased by 300 percent. During this whole period monopoly flourished, the trustification of industry developed at a rapid speed, and the number of blood-nourished millionaires multiplied. Never before had the world seen the like of this saturnalia of capitalist profit-making. But the living standards of the workers lagged.

Various factors combined to create the Coolidge post-war boom. Among these were the American capital export of $20 billion in war and post-war loans to finance Europe's war and to rebuild its shattered industries; the capture of world markets by the United States from the crippled European powers; the introduction of an intense speed-up, or "rationalization" of industry in the home country; the growth of a huge installment-buying system; the industrialization of the South; the expansion of the automobile industry; and the wide extension of luxury industries. The whole fevered development was based upon the destruction wrought by World War I. This great war not only tremendously enriched the United States and made it far and away the wealthiest capitalist country, but it also demonstrated that the world capitalist system, including the United States, was sinking into an incurable general crisis, and that in order to keep going even temporarily, it required the fatal stimulant of war.

During the Coolidge "prosperity" period American imperialism was aggressively expansionist and reactionary. Its general predatory spirit was exemplified by the huge growth of military and naval armaments, repeated armed invasions of Caribbean and Central American countries, systematic penetration of Germany through the Dawes and Young plans, violent hostility toward the Soviet Union, and inroads upon China through the device of the "Open Door" policy. It was characterized by such developments on the home front as the passage of reactionary legislation to curb union labor, the systematic encouragement of company unionism, the execution of Sacco and Vanzetti, the continued imprisonment of Mooney and Billings, the unchecked outrage of lynching in the South, the Teapot Dome scandal, the Scopes anti-evolution trial, and the like.


The central economic aim of the big capitalists in the United States during this period was to speed up the workers in production, to exploit them to the limit of their endurance. To exploit the workers more intensively is, of course, always the objective of the capitalists; but this was especially the case during the Coolidge years. Their aim was to satisfy the commodity-hungry post-war world markets, with a minimum of new capital investment—the demand for capital export to Europe being very heavy. Hence the speed up or "rationalization of industry," as they called it, became a fetish with the American capitalists during these years.

The heart of the rationalization of industry was the system of mass production. With the assembly line as its characteristic feature, and the reduction of innumerable skilled jobs to the common denominator of the line, this changed the whole lay-out of the plant. This system, stimulated by World War I, was the basis for the eventual great increase in the productivity of American industry. During the 1920's the capitalists strove to drive the workers even faster and to make them helpless in the mass production system.

But to enforce their speed-up of the workers, it was necessary for the employers to break the latter's resistance to being thus ruthlessly driven. Here the conservative trade union leadership came into the picture, as willing servants of the employers. The top A.F. of L. and Railroad Brotherhood leaders had rallied their membership for the employers' imperialist World War I and shamelessly sabotaged the workers' resistance during the big union-smashing drive of the bosses after the war had been won. Now they could be depended upon to perform this new speed-up task for their masters, the employers—and they did just that.

The conservative union leaders were not only willing but eager to carry out the bosses' plans for the "rationalization" of industry. What happened to the workers' living standards in the meantime was not of primary concern to them. These labor bureaucrats were frightened by the serious defeats the unions had suffered during the post-war offensive of the capitalists and by the growth of radical sentiment among the rank-and-file workers. And so the only condition they laid down to the arrogant employers was that they be allowed to maintain some sort of dues-paying mass unions, however enfeebled, that would suffice to pay their over-swollen salaries, not to mention their other financial perquisites.

To this end, the conservative union leaders were ready to go far in the direction of company unionism, and they did. William Green, who succeeded Gompers as the head of the A.F. of L. in 1924, made this willingness very clear in a number of the most servile speeches ever delivered by a labor leader in the United States. He placed the unions of the workers at the disposal of the bosses in the latter's speed-up plans. The Executive Council's report to the A.F. of L. convention of 1927 showed how far the labor bureaucrats were going toward company-unionizing the trade unions. It declared that "there is nothing that the company union can do within the single company that the trade union cannot develop the machinery for doing and accomplish more effectively. Union-management co-operation ... is much more fundamental and effective than employee representation plans for co-operation with management."

Some sections of big, open-shop capital became interested in these offers of the A.F. of L. leaders to have the craft unions "do better" the functions of the company unions than the company unions themselves. William Green reported to the Executive Council, in January 1927. that "the General Motors Company was prepared to agree to the organization of some of its big plants as an experiment in union-management co-operation, provided that there would be no jurisdictional fights." 3 But the 19 unions claiming jurisdiction over the automobile workers could not agree among themselves as to which should get the workers. With the characteristic stupidity of craft unionism, they preferred see the basic industries remain unorganized than to surrender their rival paper claims over the workers. Therefore the whole scheme fell through. Lorwin says that other big concerns besides General Motors were also interested in Green's plans to company-unionize the American labor movement. 


The new orientation of the labor bureaucracy toward intensified class collaboration for the speed-up began to manifest itself in the form of the so-called Baltimore and Ohio plan, a scheme for more intensive production, devised by the efficiency experts of that railroad. It was forced upon the defeated shopmen on several roads at the end of their ill-fated strike of 1922. The essence of the B. & O. plan was that if the workers would agree with the bosses to turn out more work they would thereby automatically reap real advantages in the shape of increased wages and more continuous employment.

With the top labor officials bankrupt after the big post-war drive of the employers against the unions, the A.F. of L. convention of 1923 grasped at the B. & O. plan, or union-management co-operation scheme, as manna miraculously fallen from heaven. It offered a way to preserve some semblance of mass organization and it gave them a sort of program to take to the workers, so they made the most of it. The convention, composed almost exclusively of high union officials, hailed the plan as a turning point for the labor movement and the United States. Two years later the 1925 convention of the A.F. of L. developed the plan in great detail as the "new wage policy."

Not content with offering to co-operate with the capitalists for more production, the trade union leaders went into the speed-up business themselves. They put efficiency engineers on the union payrolls and had them devise plans for increasing production. These schemes they then proceeded to force upon the workers and also offered them, free of charge, to the employers. Many labor organizations followed such practices. Indeed, unions that did not do so were looked upon by the bureaucrats as backward and unprogressive. So low had the trade union leadership fallen that it had actually transformed the unions from fighting organizations, designed to protect the workers' interests, into parts of the employers' producing mechanism. Union-management co-operation thus went far beyond even the rosiest dreams of the classical industrial efficiency expert, Frederick Taylor. Before World War I, Taylor's speed-up devices had been condemned with bell, book, and candle by the labor officialdom as the death of all trade unionism; but now these same leaders accepted Taylor's ideas as the gospel of organized labor.

The erstwhile "progressive" or center group in the labor movement vied with the right-wing labor leadership in its enthusiasm for union-management co-operation. The Socialists, too, grabbed it hook, line, and sinker. In fact, in no unions in this country was the speed-up system so highly developed as in the supposedly socialistic needle trades unions. They had complete sets of efficiency engineers, standards of production, and all the rest of the speed-up plans. Leo Wolman, research director of the Amalgamated Clothing Workers, thus explained the role of labor unions in this period: "The primary aim of the labor union is to co-operate with the manufacturer to produce more efficient conditions of production that will be of mutual advantage. In some cases labor unions will even lend money to worthy manufacturers to tide them over periods of distress."


In order to drive ahead with the speed-up, "rationalization" plans and to demoralize the labor movement still further, blatant American imperialism put forth during the Coolidge period a whole series of "prosperity illusions" designed to befuddle and confuse the workers. Never in the whole history of American capitalism did the bosses give birth to so many glowingly Utopian ideas of social progress as in the hectic boom times of the 1920's.

For example, Thomas N. Carver, Harvard professor of political economy, came out with a glittering theory to the effect that the workers, because of mass production and the speed-up, not only could become but were becoming capitalists by buying up industrial stocks. 4 "The only revolution now under way," said he, "is in the United States. It is a revolution that is to wipe out the distinction between laborers and capitalists by making laborers their own capitalists and by compelling most capitalists to become laborers of one kind or another." He stated that the savings of the workers were so great that "Any day the laborers decide to do so, they can divert a few billions of savings to the purchase of common stock of industrial corporations, railroads, and public service companies, and actually control considerable numbers of them." Thus, said he, "If the railroad employees would merely save the increase which they had recently received in wages, it would give them $625,000,000 a year for investment. On this basis, if they bought railroad stocks at par, they could, by investing all their savings and dividends in railroad stocks, buy $3,490,000,000 in five years. This would give them a substantial majority of all the outstanding stocks." But how the workers were to eat in the meantime, Carver did not say.

Professor Tugwell of Columbia, in his book, Industry's Coming of Age, developed the perspective that capitalism—monopolized industries and all—was gradually becoming "socialized," with the private ownership feature tending to atrophy and die out. Gillette, the safety razor magnate, in his book, The People's Corporation, painted a capitalist-"Socialist" Utopia, which the people were gradually creating by buying industrial stocks, a plan akin to Carver's. Foster and Catchings, forerunners of John Maynard Keynes, elaborated plans for "financing the buyer" which supposedly would eliminate economic crises and bring prosperity for all. Stuart Chase, an erstwhile Socialist, pictured a new and glowing mass prosperity inherent in the simple plan of abolishing waste in industry by applying more scientific production methods. Whiting Williams, Mac-Kenzie King, Glen Plumb, Thorstein Veblen, and many others added their voices to the chorus of capitalist economists and industrialists who were about to create a world of plenty for all. It was in this spirit that Herbert Hoover, who was Secretary of Commerce under Coolidge and one of this school of economists, assured the people after his election, in November 1928, that the United States was then on the verge of abolishing poverty. All this demagogy, of course, was but the delirium of optimism (in an extreme degree) always felt by the capitalists when their economic system is in the boom phase of its cycle.

The substance of what all these exuberant boosters of American capitalism were saying was that capitalism in this country, by the natural processes of its evolution, was turning into socialism, if not something far superior. Capitalism in the United States, distinct from that in Europe, had overcome its internal contradictions, had "come of age," was being democratized, and had entered upon an endless upward spiral of development and mass prosperity. It was a sort of "capitalist efficiency socialism." The "New Capitalism," they called it. As these soothsayers would have it, Henry Ford had superseded Karl Marx.

During these hectic years the capitalists of Europe and elsewhere looked with envy and admiration upon the United States, where the capitalists by the magic of mass production and the speed-up had apparently tamed the labor movement and solved all economic problems. In the forefront of these foreign admirers of American monopoly capitalism and imperialism were the Social-Democrats of Europe. Rudolph Hilferd-ing, leading theoretician of German Social-Democracy, said at the Kiel 1927 convention of that party, "We are in a period of capitalism which in the main has overcome the era of free competition and the sway of the blind forces of the market and we are coming to a capitalist organized economy." Karl Kautsky also supported this line. The Social-Democrats outdid each other in praise of the new American mass production and intensified class collaboration, and they sought eagerly to introduce these things into their own countries. In the United States, so they believed, all their Bernsteinian dreams of capitalism turning into "socialism" were coming true.


The upper officials of the A.F. of L. and the Railroad Brotherhoods fell right in with this campaign of ideologically poisoning the working class, even as they had fully accepted the speed-up program which was the basis for the great flood of capitalist demagogy about everlasting "prosperity." William Green, an apt pupil of Gompers, arch-reactionary and labor sponsor of capitalism, took the lead in pledging loyalty to the capitalist system and in excoriating everything radical or revolutionary. H. V. Boswell, head of the Locomotive Engineers Bank of New York, also expressed the current bureaucratic opinion when he said: "Who wants to be a bolshevik when he can be a capitalist instead? We have shown how to mix oil and water; how to reconcile capital and labor. Instead of standing on a street corner soapbox, screaming with rage because the capitalists own real estate, bank accounts, and automobiles, the engineer has turned in and become a capitalist himself." 5

To carry out their new speed-up, get-rich-quick orientation, the labor bureaucrats, upon Carver's suggestion, worked out what they grandiloquently called "the higher strategy of labor." Matthew Woll, in Iron Age, thus expressed his idea of this newfangled term: "In its early struggles labor sought to retard, to limit, to embarrass production to obtain that which it desired. Now it seeks the confidence that it is a preserver and developer of an economic, industrial, and social order in which workers, employers, and the public may all benefit." And Warren S. Stone, "progressive" president of the Locomotive Engineers, explained it thus: "Organized labor in the United States has gone through three cycles. . . . The first was the period during which class consciousness was being aroused. . . . The second was the defensive struggle for the principle of collective bargaining. . . . The third cycle or phase lies in constructive development toward a system of co-operation rather than war." 6

The plain English of all this blather was that the "new wage policy" and "the higher strategy of labor" amounted to a speed-up, no-strike policy. That is, the workers were to produce to the limit and then trust to the "intelligent" capitalists to reward them adequately in friendly conferences with the union leaders. Consequently, the number of strikes and strikers toboganned. In 1932 the total number of strikers was 1,612,562, but by 1929 this had fallen to only 230,463. 7 The workers' living and working standards suffered accordingly.

Along with Wall Street's no-strike policy, dolled up as "the higher strategy of labor," the top labor leadership also accepted the current bourgeois propaganda about the tremendous savings of the workers, and they plunged into business in a big way. During the early twenties they set up a whole maze of labor banks, insurance companies, investment concerns, and the like, more than one of which operated upon a non-union basis. This was "trade union capitalism," as Communists called it. The unions went in especially for labor banking. The international union or important central labor body that did not support labor banking was considered very much behind the times. All told, at the height of this craze, in 1925, there were 36 labor banks, with total resources of $126,356,944. Outstanding leaders in this banking movement were the Locomotive Engineers and the Amalgamated Clothing Workers.


The top leadership of the American Federation of Labor and the Railroad Brotherhoods, ever since the 1890's, had been noted for its corruption by capitalist influences, its almost total lack of working class integrity. The characteristic A.F. of L. leader of the period (with many honorable exceptions, of course) was one who was devoted to the perpetuation of capitalism, was an inveterate enemy of all radicalism, and looked upon trade union leadership as an easy way of making a good living. Top jobs in the unions were rich sinecures, to be grabbed and held by any means possible. Such posts, among their numerous financial advantages for their holders, provided many opportunities for union leaders to milk employers who wanted guarantees against strikes, and also opportunities for these leaders to develop remunerative alliances with the Republican and Democratic parties. The welfare of the workers who made up the unions was a matter of but secondary consideration. The marvel was how the labor movement could exist at all, much less make real progress, with such a corrupt top leadership.

During World War I, the post-war offensive, and the Coolidge "prosperity" period, the corrupting capitalist influences upon the labor bureaucracy were particularly strong, and the leaders' morale sank visibly under the pressure. Many of the officials became rich from the plentiful sources of graft open to them. John Mitchell, former president of the United Mine Workers and first Vice-President of the A.F. of L., was a characteristic figure, a real capitalist. 

When he died in 1919 his wealth totaled $244,295, including investments in many capitalist concerns—coal mines, Armour & Co., the B. & O., the New York Central, the Rock Island—all companies that were noted for their labor-crushing activities. George L. Berry, head of the Printing Pressmen and long an honored figure in the A.F. of L. hierarchy, acquired a million dollars or more by his various brands of skulduggery. There were many like him in the various unions. Dozens of labor leaders were taken over by the capitalists and used as "personnel directors"—as strike-preventers—in their industries.

Corruption was most rampant in the building trades, which formed the backbone of the A.F. of L. during these times. There real gangsterism prevailed. Many building trades leaders sold "strike insurance" freely to the employers and robbed their membership by every known device. Numbers of them also were directly tied up with the underworld during the period of prohibition. They ruled the unions by force and, fighting for control, they periodically carried on murderous gun battles with each other. A star product of this Gompers unionism was Robert P. Brindell of New York, who was credited with amassing a million dollars in the two years before he was exposed by the Lockwood Committee in 1920. Another was Simon O'Donnell, wartime head of the Building Trades Council of Chicago, who was given a spectacular funeral, gangster fashion, with a $10,000 coffin, when he died in 1927. Still another was the notorious "Big Tim" Murphy, also of the Chicago Building Trades. Murphy, who was finally killed in a gangster war, expressed the characteristic A.F. of L. philosophy of labor leadership as follows: "I'm still pretty much of a kid, but I made a millon and spent a million, and I figure I'll make another million before they plant me." 8

The bosses cultivated this corrupt type of leadership, even though occasionally, to discredit the unions, they would send one or two crooked union officials to jail after a spectacular trial. As for the A.F. of L. Executive Council, it did precisely nothing to eliminate the gangsterism and corruption. On the contrary, the Mitchells, Berrys, Brindells, O'Don-nells, and many more of the like were for decades dominant figures in the A.F. of L. Some of them enjoyed honored seats in the Executive Council itself, and generally they crowded the A.F. of L. conventions, voting down all "red" proposals. This was the kind of labor leadership that so ruthlessly rejected amalgamation, a labor party, and Soviet recognition at the 1923 convention of the A.F. of L., even though the bulk of the organized workers had demanded these policies. It was such labor leaders, too, who were ardent supporters of the Gompers clique in office, and defenders of the "new wage policy," "the higher strategy of labor," "trade union capitalism," and militant struggle against the left wing, during the Coolidge boom period of 1923-1929.


The intensified class collaboration carried on by the conservative upper leadership of the trade unions during the Coolidge period had a number of very harmful effects upon the workers and their unions. For one thing, the acceptance and propagation by the union leaders of prosperity illusions, put out by the employers, were demoralizing ideologically to the workers. Especially confusing was the boundless flood of propaganda to the effect that economic crises were now a thing of the past in the United States. It left the workers quite unprepared for the economic holocaust that struck in October 1929. The top trade union leaders, deceived by their own propaganda, were even less ready for the great economic breakdown than the workers themselves when it finally came.

The bosses' speed-up program, popularized among the workers by the trade union leaders under the name of the "new wage policy" and "the higher strategy of labor," also operated to the detriment of the working and living standards of the workers. This no-strike policy took all the fight out of the unions. Never in the life of the modern American labor movement was its morale so low as during the Coolidge period of intensified class collaboration. Taking advantage of the cultivated inertia of the unions, the employers naturally grabbed unto themselves all the advantages of the increased production which they were able to wring from the workers under the very convenient plan of union-management co-operation.

There was also a general worsening of conditions in the shops during this period. With the class vigilance of the unions weakened by the pest of class collaboration, the bosses were able, under the sacred sign of industrial efficiency, to strip the workers of many hard-won labor conditions. In a period of industrial activity, when the workers possessed a maximum of latent power with which to improve their wage rates, the employers kept wages down. From 1923 to 1929, although output in industry increased no less than 29 percent per worker and profits doubled and tripled, the workers' wages advanced little, if at all. Wage increases, coming mostly from overtime work, went mainly to the skilled workers, with the wage conditions of the masses of semi-skilled and unskilled either stagnant or declining. The top union officials, now blossoming forth as bankers and industrialists, had little time to waste upon such minor matters as protecting the workers' standards.

The class collaboration policies of the union leaders also had deleterious effects upon the growth of the unions. The Coolidge boom years, although accompanied by considerable unemployment, constituted a period of high industrial activity that should have provided a big increase in union membership. But the unions actually declined numerically during these years. Thus in 1922 the A.F. of L. had 3,195,635 members, whereas in 1929, after several years' dose of "union-management co-operation," the number had fallen to 2,933,545, a l°ss °f 262,090 members. Actually the loss was much greater, as many unions, despite membership decreases, continued for internal political reasons to pay their earlier, top-figure per capita tax to the A.F. of L. For example, in 1928 the U.M.W.A. paid on 400,000 members, as in 1920, but in the meantime it had lost about 200,000 dues-paying members. The 1923-29 period was the first time in labor history that the trade unions failed to grow substantially during a long period of "prosperity."

To make the "new capitalism" policies still more bankrupt, the union leaders made ducks and drakes of the millions of dollars that the workers had so trustingly placed in their hands through the many labor banks and other financial and industrial concerns organized during the epidemic of "trade union capitalism." The whole shaky structure soon collapsed, with losses to the workers of huge sums of money. This financial debacle was brought about by wild speculations in Florida, and by general recklessness and incompetence. Speaking of the breakdown of the Locomotive Engineers' big string of banks, Perlman and Taft say, "On the larger issue of redirecting capitalism the movement for labor banks, as shown by the engineers' fiasco, was little more rational than the children's crusade against the Saracens." 9 The number of labor banks fell off rapidly, in the midst of the growing scandal. By 1932 their number was reduced to seven, and now there are only four of them left. This was the unhappy ending of Professor Carver's scheme for the workers to buy out capitalism—as executed by the capitalist-minded reactionaries heading the A.F. of L. and Railroad Brotherhoods.

1 James S. Allen, World Monopoly and Peace, p. 120, N. Y., 1946.
2 F. Sternberg, The Coming Crisis, p. 119, N. Y., 1947.
3 Lorwin, The American Federation of Labor, p. 246.
4. T. N. Carver, The Present Economic Revolution in the United States, pp. 9, 94, 124, Boston, 1925.
5 Cited in Bimba, History of the American Working Class, p. 347. 
6 Cited in World's Work, Nov. 1924.
7 American Labor Year Book, 1929, p. 135.
8 William Z. Foster, Misleaders of Labor, Chicago, 1927.
9 Perlman and Taft, History of Labor in the U.S., Vol. 4, p. 578.

Chapter 18

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