The Guffy-Snyder Bill and Labor's Dilemma

Charles R. Eckert

[A speech delivered in the U.S. House of Representatives, Saturday, 17 August 1935]

Mr. Speaker, the bill under consideration is intended to bring order, efficiency, and stability to an industry that for decades has been chaotic, inefficient, and unsettled. The bituminous-coal industry of the United States affects the economic welfare of thousands of operators, tens of thousands of workers, and millions of consumers. It is one of the major industries in the Nation and a very vital factor in all the activities that go to make up the economic life of the Nation. When the magnitude and importance of the bituminous-coal industry is reviewed in perspective, the place it occupies in our economic life is self-evident. An industry that bears such a vital relation to the well being, happiness, and prosperity of all the people must be kept in a healthy and efficient state of production and distribution.

The objects of the bill, as stated by Senator Guffey, one of the co-authors, is:

• First. To stabilize the bituminous-coal mining industry and promote interstate commerce in bituminous coal;
  
• Second. To provide for cooperative marketing of bituminous coal;
  
• Third. To levy a tax on bituminous coal and provide for a drawback under certain conditions;
  
• Fourth. To declare the production, distribution, and use of bituminous coal to be affected with a national public interest;
  
• Fifth. To conserve the bituminous-coal resources of the United States and to establish a national bituminous-coal reserve;
  
• Sixth. To provide for the general welfare, and for other purposes.
  

On account of the part bituminous coal plays in all the various activities of human endeavor, it is essential that the industry be efficient, stable, and constant, and it is the hope that this bill will bring about this much-desired result. The hope is that the industry can be brought into a healthy condition by governmental regulation and control. The principle of public regulation and control of certain types of business is a well-settled principle in American law. Until recently, however, the principle of regulation and control was confined to those businesses that were affected with a public use. This limited and restricted regulation and control has been confined to that class of business that could not function without the aid of political power.

For example, none of the public utilities could function without having the power of eminent domain nor without a grant of government for the use of public thoroughfares. Unless a public utility - whether railroads, telephone, electric power, gas, water, or any other public-utility service is vested with the power of eminent domain and granted permanent use of streets and highways, it cannot function at all. And because public utilities that are operated either by a natural or artificial person are delegated the sovereign power of the people, public regulation and control is imperative. In the absence of such control and regulation, public-utility companies, being engaged in a monopolistic business, would have a free hand to plunder the consuming public without stint or mercy.

As stated above, the principle of public regulation and control in this field of business is accepted and recognized as sound law; but the coal industry is not within this class. The business of producing and distributing coal is not monopolistic in character. It is highly competitive and therefore this bill, as others that have been enacted into law as a part of the "new deal" program, is a distinct departure from the principle involved in Kale's Rule, to wit:

Any business affected with a public use is subject to public regulation and control.

It must be remembered, however, that coal is a natural resource limited in quantity and therefore a very proper subject for conservation by the Government. It is the principal source for light, heat, and power and, as has been said, goes into every home, every business, and every industry. No one in America can escape its effects and influence. This, coupled with the fact that coal is a natural resource limited in quantity, the Government is within its right and power to jealously guard and conserve it for this and future generations.

There are those who are loathe to extend the scope of Bale's rule. It was the common belief in the early history of our country and a cardinal tenet of the Democratic Party that any business that is competitive in character should be left in private hands, free and removed from governmental interference. Upon this theory the production and distribution of coal was recognized as a distinctly private business and has been so conducted from the time when the first black diamond was quarried in America to the present day.

At the turn of the century economic forces and questionable practices began to disturb the equilibrium of the coal business and chaos and disorder have been the result. It is highly probable that this unsatisfactory and disordered condition of the coal business could have been avoided if sound economic principles had been recognized and applied during the development of our economic system. And the hope is being entertained that, with the removal of the basic wrongs in our economic order, not only the coal business but all other businesses in the competitive field will in due time, under the supervision and regulation of the Government, make such healthy recovery that public regulation and control will be unnecessary.

But be that as it may, the fact is that here is a condition and not a theory with which the producers, miners, and consumers are confronted, and hence the present legislation. This bill ought to be enacted into law and it is to be hoped that the proposed legislation will be a boon to the industry, to the miners, and the consuming public.

This legislation is an indication of the economic trend of the times. As one makes a survey of the character of the legislation now demanded by many business interests of the country, one is not only reminded of the change that is taking place, but also of the fact that many types of business are pleading for governmental regulation and control. There is common complaint that the Government is going into business, when, as a matter of fact, it is business that is forcing the Government to take a hand in the management of the affairs of business.

A few days ago this House had under consideration a bill that provided for the Federal Government to grade and supervise in general the sale of the produce of the tobacco farmer. The debate on that bill revealed the fact that the tobacco growers are frequently imposed upon by the tobacco buyers and that, in dealing with the more astute and alert representatives of the tobacco manufacturers they are helpless, and for protection the tobacco farmers called upon Uncle Sam to set up a governmental agency that will help them to grade, classify, and supervise in general the sale of their tobacco. This is in line with the demands of many other kinds of business. For example, milk producers in various parts of the country have been appealing for governmental regulation. In several States milk-control boards have been set up at the request of milk producers, for the purpose of umpiring the milk business.

In the State of New York, under a Democratic Governor and Republican legislature, a milk-control board has been established. In Pennsylvania, under a Republican administration, a milk-control board has been set up. This indicates that the program of regulation is not confined to one political party. Democratic administrations and Republican administrations are simply responding to the demands of various business interests for help, regulation, and control.

In many other lines of human endeavor relating to the production and distribution of goods, the same demands have been made. Uncle Sam, as well as State governments, have been implored by ever so many groups of producers and distributors to extend a helping hand so that the Government finds itself directing, umpiring, and regulating business to such an extent that many new bureaus have come into existence and many more employees - both Federal and State - have been added to the pay rolls. Many citizens, alarmed at the trend of events, are crying aloud for retrenchment. All this, of course, is natural, but quite inconsistent in view of the fact that it is not the Government that is reaching out for greater control of business, but is forced and pushed into the task of doing all these unusual things, in many instances, by the persons who are complaining of too much interference with business on the part of the Government. In fact, those who are making the most noise about the modern trend of events are the very ones who years ago subtly and furtively importuned and inveigled the Government to become a partner in business.

The protective tariff, aside from its economic merits or demerits, is a striking example of government in business. The development of the railroads in the middle of the last century is another illustration of how government has been used and abused by those who sought to engage in a public-utility service. Millions of acres of Uncle Sam's great western domain were granted to the railroads as bounty under the pretext that the railroad companies needed governmental aid. During all the years since the birth and growth of the various public utilities, financial aid and other concessions were granted by government - municipal, State, and Federal - to public-utility companies. When the industrial and financial collapse came in 1929, the railroad companies, as well as other companies engaged both in public and private business, came to Uncle Sam entreating and imploring for help and assistance, and now the small producers - even the farmers, small merchants, and manufacturers - are clamoring for help, aid, and assistance at the hands of the Federal Government.

It is an ominous sign. It ought to put the country on inquiry as to why the change from the stalwart, independent, self-reliant farmer, manufacturer, and merchant of the old days to the crying, dependent, and helpless individual of today. Surely there must be something radically out of place in the present economic set-up. If farmers, manufacturers, and merchants today enjoyed equal economic opportunities, it is reasonable to conclude that our people would still be strong, independent, and self-reliant.

In line with the cry of business for governmental help and assistance, labor in many instances feels compelled to join the army of business supplicants. This is illustrated in the demands of a resolution passed by the Workers Progressive Association of New Castle, Pa., on August 9, 1935, which reads as follows:

Whereas the present President of the United States has declared that those now unemployed are without employment through no fault of their own; and

Whereas those now unemployed are disposed to accept no responsibility whatever for conditions that render employment impossible; and

Whereas all workers, unemployed and employed, are in general agreement with the statement of the preamble to the constitution of the American Federation of Labor, that "A struggle is going on … a struggle between the capitalist and the laborer, which grows in intensity from year to year, and will work disastrous results to the toiling millions if they are not combined for mutual protection and benefit; and

Whereas the present Federal Administration stands committed to approval of the principle of collective bargaining; and

Whereas recent press dispatches have emanated from the office of the Federal Relief Administrator purporting to indicate that where organization of workers exists, rates of pay and working conditions will conform to demands of such organizations; and

Whereas there is no hope whatever of the slightest improvement in employment opportunities in ordinary private industry until buying power in the form of money gained by wages in excess of mere subsistence requirements is made available to the large percentage of the population of the country now unemployed. Now, therefore, be it

Resolved, By the Workers' Progressive Association, that vigorous protest be made against the establishment of wage schedules on work-relief projects by Presidential order without any pretense of collective bargaining; and, be it further

Resolved, That specific protest be made against the publicly announced $19 to $94 a month scale provided in the President's original order and $12 per week "rate" to apply under this order in local territory.

Any fair-minded person must approve the general spirit of the resolution. Every friend of social justice appreciates the fact that labor is cheated of a large portion of the fruits of its toil. It is only too true that opportunities for employment in private industry will be limited until the buying power of the producing class - whether employed or unemployed - will be materially increased, But while this is true, yet the deplorable feature of the situation is the fact that the hope of increasing the people's purchasing power is from the Government. According to the American theory, our Government was set up for the purpose of securing to the citizen his inalienable rights and, with his rights secure, economic freedom and opportunity for making an honest and decent living were to be assured. Of course, everyone knows that such is not the case in the Nation today. And consequently both business and labor are constrained to implore and beseech the Government for aid and assistance. And under the deplorable conditions that have developed in our country during the years gone by, there is no other recourse. This fact ought to put labor as well as industry on inquiry as to why the present insecurity, instability, and helplessness not only on the part of business but of labor as well. Edmund Burke, a century ago, made an observation that both business and labor ought to consider thoughtfully and prayerfully. Burke said:

In a state of nature it is an invariable law that a man's acquisitions are in proportion to his labor; in a state of artificial society it is a law as constant and. invariable that those who labor most enjoy the fewest things; and that those' who labor not at all have the greatest number of enjoyments.

This observation of the great English statesman was made at a time when the machine age was in its infancy. It is an observation that conforms absolutely to the facts of history. During all the years of human civilization the many have been exploited by the few. And it would seem that as long as this condition prevails there can be no hope for the abolition of poverty or permanent prosperity for those who labor and do the world's work. Passing of resolutions will not solve this problem. It can only be solved by the establishment of a social order based upon sound economic principles. Until industry and labor will learn their true relations and ascertain the right answer to the observation of Burke, the producers of wealth from generation to generation will continue to enjoy the fewest things, while those who labor not will have the greatest number of enjoyments.

Industry and labor are in a deplorable plight. Government aid and Government regulation will ease the pangs of their misery and distress but the freedom and prosperity of industry and labor, which is theirs by natural right, can only be achieved by the establishment of an order of human affairs that conforms to the spirit of our Declaration of Independence. There is no special Providence for labor and industry. They can only find their way to freedom and prosperity by taking thought. Well has it been said that:

Social reforms are not secured by noise and shouting; by complaints and denunciation; by the formation of parties or the making of revolutions; but by the awakening of thought, by the progress of ideas. Until there is correct thinking, there cannot be right action, and when there is correct thought, right action will follow.

Let us get a mental picture of the actual condition of industry and labor. An eminent American, profound thinker and social philosopher, introducing a remarkable book that came from his pen, used these words in describing the condition of the laboring masses:

Near the window by which I write, a great bull is tethered by a ring in his nose. Grazing round and round, he has wound his rope about the stake until now he stands a close prisoner, tantalized by rich grass he cannot reach, unable even to toss his head to rid him of the flies that cluster on his shoulders. Now and again he struggles vainly, and then, after pitiful bellowings, relapses into silent misery.

This bull, a very type of massive strength, who, because he has not wit enough to see how he might be free, suffers want in sight of plenty, and is helplessly preyed upon by weaker creatures, seems to me no unfit emblem of the working masses.

In all lands, men whose toil creates abounding wealth are pinched with poverty, and, while advancing civilization opens wider vistas and awakens new desires, are held down to brutish levels by animal needs. Bitterly conscious of injustice, feeling in their inmost souls that they were made for more than so narrow a life, they, too, spasmodically struggle, and cry out. But until they trace effect to cause, until they see how they are fettered and how they may be freed, their struggles and outcries are as vain as those of the bull. Nay, they are vainer. I shall go out and drive the bull in the way that will untwist his rope. But who shall drive men into freedom? Till they use the reason with which they have been gifted, nothing can avail. For them there is no special providence.

Because of our failure to think and think right, because of industry and labor's failure to analyze the economic problem intelligently and scientifically, because of their failure to trace effect to cause, they find themselves today, as in all the ages past, the prey of the cunning and the privileged. Victor Hugo, in his preface to Les Miserables, says:

So long as there shall exist, by reason of law and custom, a social condemnation which, in the face of civilization, artificially creates hells on earth and complicates a destiny that is divine with human fatality; so long as the three problems of the age - the degradation of man by poverty, the ruin of women by starvation, and the dwarfing of childhood by physical and spiritual night - are not solved; so long as in certain regions social asphyxia shall be possible; so long as ignorance and misery remain on earth, books like this cannot be useless.

And so let me say that so long as conditions prevail such as exist in the bituminous-coal industry of Pennsylvania and other States, laws such as the Guffey-Snyder bill cannot be useless.