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The New International, July 1934

 

Alfred Weaver

Strikes and the Economic Cycle

From New International, Vol.1 No.1, July 1934, pp.18-20.
Transcribed & marked up by Einde O’Callaghan for ETOL.

 

IN A feature article entitled The Wave of Strikes: A Vast NRA Problem (NY Times, October 15, 1933) R.L. Duffus writes as follows of the strikes which were taking place at that time:

“Why should strikes and lockouts multiply at this particular time? The historic fact is that they have always increased at the beginnings of periods of prosperity and that they have always decreased during depression. They rose from 1886 to 1892, a time once regarded as the golden age of American labor. They declined with the depression of 1893, to rise as business improved in 1899 and thereafter. They dropped in 1907 and 1908, which were bad years, went up in the good years of 1909 and 1910, climbed during the early years of the World War, fell off during the post-war depression, mounted again when good times came back.” [1]

This statement is not accidental. In it is represented the viewpoint of the responsible spokesmen of the “New Deal” administration: Believing an industrial upturn to be taking place, the NRA strike-breaking machinery was set up as a curb on the upsurge of strikes which it was expected would (and did) follow.

The American bourgeoisie have here shown great sagacity. Not all sections of the working class movement, however, are as aware as they of the relationship of the tempo of the class struggle to the different stages of the cyclical economic crisis. The Stalinists, for example, deny any connection whatsoever.

One typical example will suffice. In the Communist, March 1932 a certain C. Smith writes as follows:

“The main obstacle to the organization of broad strike struggles is the theory that in times of crises it is impossible to conduct strikes successfully. This theory is systematically fostered among the workers by the reactionary trade unions, as well as by all renegades from Communism. Trotsky wrote the following on the economic strikes in France in an article entitled The Third Period of the Mistakes of the Comintern:

“‘By no means does the perspective of the chronic economic crisis necessarily have to be followed by the perspective of the extension of the economic strikes ... With a sinking economic trend, with the increase of unemployment. .. increased exploitation calls forth not a radicalization of the masses, but on the contrary, discouragement and demoralization.’

“But facts speak louder than words. The past year, 1931, was a record [?!!?] year of economic struggles in all [?] capitalist countries. Furthermore all statistics show [what statistics?] that in the past it was in the periods of good times and of crises that the workers conducted a great many strikes of great extent ... The question is only the method by which economic struggles must be conducted in the period of crisis. We find in every period of crisis that the strikes increase [??] not only in extent but also in sharpness ...” [2]

The following table indicates the course of events from 1881 to 1890 inclusive, the period which includes the crisis which broke out in 1884:

Bi-Monthly Index Of Industrial Activity [3]

Year

Jan. &
Feb.

Mar. &
Apr.

May &
June

July &
Aug.

Sept. &
Oct.

Nov. &
Dec.

No. of Workers
on Strike
 [4]

1881

112

110

110

110

109

109

101,090

1882

110

110

106

105

108

109

120,860

1883

108

105

103

103

103

  98

122,198

1884

  95

  96

  97

  94

  91

  90

117,313

1885

  83

  89

  89

  89

  89

  95

158,584

1886

  95

  98

101

103

103

105

407,152

1887

106

111

104

103

108

106

272,776

1888

100

  99

100

101

105

105

103,218

1889

106

103

101

103

104

106

205,068

1890

109

111

112

109

112

107

285,900

Commons speaks of this period as follows (History of Labor in the United States, Vol. 2):

“The strike which had been overshadowed by the boycott during the latter half of 1884 and the first half of i885, again came into prominence in the latter half of the year. This coincided with the beginning of an upward trend in general business conditions ... American Labor movements have never experienced such a rush of organization as the one in the latter part of 1885 and during 1886.”

It is clear that the big strike wave of 1886 took) place during the upward swing in the economic cycle. For the years 1889 and 1890 the increase in the number of strikers over that of the year 1888 also corresponds to a general rise in industrial activity. The years 1882 to 1884 were accompanied by a practical standstill in the number of workers on strike; the years 1887 to 1888 by a drop. In both these latter periods an economic decline took place.

The events for the years 1891 to 1905 inclusive are indicated by the following table:

Year

Jan. &
Feb.

Mar. &
Apr.

May &
June

July &
Aug.

Sept. &
Oct.

Nov. &
Dec.

No. of Workers
on Strike

1891

101

  94

101

109

113

111

245,042

1892

114

109

106

102

105

108

163,499

1893

107

109

107

  89

  81

  84

195,008

1894

  85

  87

  81

  89

  95

  96

505,049

1895

  93

  91

  94

  99

105

105

285,742

1896

  99

  96

  94

  88

  83

  87

183,813

1897

  90

  90

  89

  91

  99

101

332,570

1898

102

101

100

99

100

101

182,067

1899

101

103

103

105

109

110

308,267

1900

111

110

108

100

  96

  96

399,656

1901

101

104

104

104

103

103

396,280

1902

102

103

104

104

104

104

553,143

1903

104

106

106

103

  99

  91

531,682

1904

95

  97

  95

  94

  95

100

375,754

1905

104

108

109

108

110

112

176,337

The general downward trend of the first of these three crises began near the middle of 1893 and reached bottom in about four months, the upturn lasting for about two years. The rise in industrial activity during the years 1894 and 1896 was accompanied by a considerable increase over the previous year in the number of workers on strike, particularly during the year 1894. [5]

The period of economic decline immediately following was accompanied by a drop in the number of workers on strike. A marked increase in the extent of strike activity over this period came with the economic upturn of 1897 to 1899. During 1898 the volume of industrial activity remained practically stationary, the strike activity was considerably less than in 1897. If we consider the entire three year period of industrial rise, however, the increase in the number of strikers over that of 1896, the year of decline, even if considered as a yearly average, is apparent.

During the six years, 1900 to 1905, the “prosperity” years of 1900 to 1903 are those in which the greatest number of workers went on strike. 1904 and 1908, the years of recovery from the short crisis of 1903 did not bring with them any increase in strike activity over the previous period; on the contrary, the statistics indicate a decrease.

The reasons must be sought in the effects which the crisis had upon the workers’ standard of living. The following table throws some light on this matter. (Real Wages in the US, 1890-1926, by P. H. Douglas, p.230):

Average Annual Earnings
of Employed Wage Earners

1890

$439

    

1898

$412

1891

  442

1899

  426

1892

  446

1900

  435

1893

  420

1901

  456

1894

  386

1902

  473

1895

  416

1903

  486

1896

  406

1904

  477

1897

  408

1905

  494

Translated into the strike statistics the foregoing states: In the strike wave which occurred during the rise from the crisis of 1893 the workers were partly successful in regaining what had been taken from them. The crisis which followed brought with it a further successful onslaught on their wages. As soon, however, as industrial activity increased, a strike wave resulted. Not being entirely successful in regaining what had been taken from them, the workers continued the fight into the “prosperity” years which followed, winning back practically all. The tempo of strike activity decreased on the economic upturn following the 1903 crisis, since that which had been taken from the workers during the slump was returned with an increase to boot. They had so strengthened themselves by their previous struggles, that it was hardly necessary to fight in order to recoup their losses. (Note the increase in trade union membership during this period.) The wage increases were granted by the capitalists in order to avoid a fight.

The following table indicates what happened during the years 1916 to 1932 inclusive:

BIMONTHLY INDEX OF INDUSTRIAL ACTIVITY

Year

Jan. &
Feb.

Mar. &
Apr.

May  &
June

July  &
Aug.

Sept.  &
Oct.

Nov. &
Dec.

No. of Workers
on Strike
 [6]

1916

113

114

114

112

115

115

1,599,917

1917

114

114

114

113

110

109

1,227,254

1918

103

107

108

110

109

106

1,239,989

1919

  98

  94

  96

106

103

102

4,160,348

1920

112

106

106

104

  98

  86

1,463,054

1921

  77

  73

  75

  75

  79

  79

1,099,247

1922

  83

  87

  92

  93

  99

108

1,612,562

1923

108

113

114

111

107

104

   756,584

1924

106

102

  91

  90

  98

102

   654,641

1925

107

105

104

104

103

108

   428,416

1926

106

106

106

107

109

106

   329,592

1927

105

105

104

102

  98

  97

   349,434

1928

102

102

101

102

106

109

   357,145

1929

110

110

113

112

109

97

   230,463

1930

  96

  95

  91

  84

  81

  77

   158,114

1931

  77

  80

  77

  73

  68

  67

   279,299

1932

  64

  59

  55

  54

  60

  60

   242,826

The tremendous strike wave of 1919, the largest in the country’s history, occurred during a period of economic upturn, following a rather sharp decline; the upturn beginning about March 1919 and reaching a high point about February 1920 [7]

1921, a year of steady decline in economic activity, shows a falling off in strike struggles; 1922, a year of continuous upturn of the economic curve, witnessed an increase in the number of workers on strike. [8]

It will be of interest to see the result which crises have had on trade-union membership (Recent Economic Trends, Vol.2, p.832):

Year

Membership

Year

Membership

Year

Membership

1897

   447,000

1909

2,047,400

1920

5,110,800

1898

   500,700

1910

2,184,200

1921

4,815,000

1899

   611,000

1911

2,382,800

1922

4,059,000

1900

   868,500

1912

2,483,500

1923

3,592,500

1901

1,124,700

1913

2,753,400

1924

3,536,600

1902

1,375,900

1914

2,716,900

1925

3,567,700

1903

1,913,900

1915

2,607,700

1926

3,504,700

1904

2,072,700

1916

2,808,000

1927

3,498,200

1905

2,022,300

1917

3,104,600

1928

3,449,100

1906

1,958,700

1918

3,508,400

1929

3,444,000

1907

2,122,800

1919

4,169,100

1930

3407,600

1908

2,130,600

 

1931

3,298,000

In his book Growth of American Trade Unions, Leo Wolman comments as follows:

“Losses in membership were in each case associated with and were probably, in part at least, the effect of business depression. Thus the periods of loss in membership, 1904-1906, 1908-1909, 1913-1915, and 1920-1923, correspond roughly with the periods of business decline. There is no question that monthly statistics of membership would show even closer correspondence. Except, also, for the year 1923 and possibly 1922, the years of business revival are generally those of gain in membership.” [9]

The history of American economic crises thus states unequivocally that during periods of economic decline the labor movement has suffered or at best remained stagnant; and that the large waves of strikes have occurred during the periods of economic revival.

Despite the deep-going wage cuts, rationalization, etc. which take place during a period of economic decline, the worker, fearing on the one hand the possible scabbery of the unemployed, and on the other hand the possibility of becoming unemployed for a long time in the case of a lost strike, goes out on strike only under extremely favorable objective conditions, or where such severe conditions are being imposed upon him that he would just as soon “starve striking as to starve while working”. [10] The fact that the workers in many industries notice that the boss is constantly on the verge of closing down in no way increases their incentive to struggle. The dissatisfaction of certain favored sections of the proletariat is allayed somewhat by the offsets to the drop in their real wages which comes about through a fall in commodity prices. Due to a falling off of dues payments and a lack of immediate perspective, the trade unions suffer.

With an industrial upturn, however, all this changes. At the same time that the closed factories begin to open, and unemployment decreases, the workers are confronted with an increase in prices, an indirect wage cut. The boss begins to show that he is anxious to maintain production. The worker again begins to feel his importance in the productive process. He is less afraid of scabbery, and feels that, even if he loses his job as the result of a lost fight, he can soon get another. A strike fever breaks out which sweeps with it even the most backward. The trade unions grow. The working class movement flourishes.

It can therefore be said with a good deal of certainty, that, considering the present historic period, and the deep-going wage cutting, speed-up, and general suffering (unemployment, etc.) which the present crisis has brought to the American proletariat, any appreciable revival of industry carries with it the perspective of a strike movement of hitherto unseen proportions. With a really revolutionary Communist party, such as has yet to be built in this country, standing at the head of such struggles, the American workers may well advance towards their goal to final emancipation.

December 1933
Alfred WEAVER

* * * *

Subsequent events have fully confirmed the conclusions of six months ago.

It is now clear that the general trend of industrial activity since March 1933 has been upward. The NY Times index of business activity, which stood at 60 in March of last year rose to 98 in July and then declined to 72 in November. Today it stands at about 86, having risen quite steadily since that time. The capitalists are showing profits, the National City Bank reporting that “210 industrial companies show for the first quarter of 1934 a combined balance of net profits over deficits of $98,000,000 which compares with ... a deficit of $23,000,000 in the first quarter of 1933”. 64 class I railroads report net earnings” of $28,700,000 for February of this year as compared to $9,864,000 for the same month last year. General Motors, Chrysler, etc. report big profits. Car-loadings and electric power production are up about 20%. Steel which was working at less than 20% of capacity now operates at about 55%.

Meanwhile there is no questioning the increase in strikes. As compared to the 242,826 strikers in 1932 there were 774,763 in 1933, the largest number since 1922. Of this number, 704,325 were on strike between April I and the end of the year; that is, during that part of the year which comes within the period of economic upturn. The present wave of strikes (longshoremen, Toledo, Minneapolis, the fermenting textile and steel strikes, etc.) hardly requires comment.

June 1934
A.W.

 

Footnotes

1. The bourgeoisie, in addition to using such knowledge for its own purposes, consoles itself with it. Duffus, for example, by abstracting from the different historical periods, implies that the ruling class has no reason to fear that a strike wave in 1933 will necessarily be of greater danger to them than those of the past.

2. Page 244. Smith decrees the class struggle to suit the “general line”; the “statistics” and “facts” exist only in his imagination. When he states that strikes occurred at all stages of past crises he merely says that the class struggle does not cease at any time. Of the relative extent of the strikes during the years of decline and upturn he is totally ignorant. Afraid to face the fact that during the deepening of a crisis, the majority of the workers themselves may not, due to objective circumstances, be willing to strike even with the best of leadership, he reduces the problem to the manner in which a strike should be conducted.

Whether or not, at any time, a particular strike or strikes should be called or can be won is another matter entirely, and should not be confused with a general perspective as to how the working class as a whole can be expected to react to economic changes.

3. These figures are from a chart published by the Cleveland Trust Company entitled American Business Activity Since 1790. On the original chart the “normal” is taken as zero, and the figures are given for every month. To avoid negative numbers and conserve space I have changed the “normal” to 100, and have given the index numbers bi-monthly. The index figure in each case represents the arithmetical average of the two monthly figures given on the chart. These figures must be used with caution. I use them here only to indicate the stages of the cyclical crisis. It must also be borne in mind that these index figures would be affected by the strikes themselves, production necessarily falling off because of them.

4. All figures for the number of strikers are from the US Department of Labor. Their absolute accuracy may justly be called into question. What is of importance however is their trend for the various stages of a crisis, for which these statistics are adequate.

I have been unable to find any data on the number of workers on strike in this country for the years 1906 to 1915 inclusive.

5. Commons speaks of this period as follows:

“The year 1894 was exceptional for labor disturbances. The number of employees involved reached nearly 750,000, surpassing even the mark set in 1886.” (Note that this figure is much larger than the one given by the US Dept. of Labor.)

6. It is interesting to note how closely the class struggle in Canada follows that in the United States. The figures for strikers in the Dominion for the years given above follow:

Year

Strikers

    

Year

Strikers

1917

50,255

1925

28,949

1918

79,743

1926

23,834

1919

148,915

1927

22,299

1920

60,327

1928

17,581

1921

28,267

1929

12,946

1922

43,775

1930

13,768

1923

34,261

1931

16,738

1924

34,310

1932

23,390

7. According to a chart prepared by Leo Wolman (Recent Economic Changes in the United States, Vol.2, p.463, Pres. Hoover’s Conference on Unemployment) the index for employment at the beginning of 1919 was about 103 (1926=100) whereas that of payrolls was 93, indicating the extent to which pay had been slashed. By March of 1920 the index for employment rose to about 113, whereas that of payrolls rose to about 121, indicating that the struggles had surely not been in vain.

8. The number of strikers is nowhere nearly as large during this period as in 1919, the workers evidently having won back what was taken from them during this crisis with less effort. During the period of economic decline the index for payrolls dropped from about 121 to about 73, that of employment from about 113 to about 80, thus indicating an average pay cut of about 15 percent. By the early part of 1923 both indices had risen to about 105, indicating that the losses due to wage-cutting had probably been won back.

9. 1905 was a year of economic upturn, and 1906 a year of “prosperity”. 1909 and 1915 were years of industrial revival. The statistics indicate a loss in union membership for each of these years. Wolman’s statement, therefore, would not be strictly accurate if judged by these figures alone. (Wolman is responsible for these figures.) There is no reason, however, to doubt his general remarks on the effect which crises have had on labor organizations. In all probability, the figures for losses ire trade union membership lagged behind the true state of affairs, – union secretaries hesitating to drop members from the books for some time after they had really ceased to belong to the organization. Thus a decrease in members which would, have taken place in 1904, would in all; likelihood be recorded as having; occurred in1905 and 1906.

10. The Bureau of Labor strike statistics bear out this contention, indicating that the percentage of strikes wholly successful during the years of industrial decline has been larger than for the years of economic upturn, although the absolute number of strikes won during the latter period is considerably larger. Both the percentage and absolute number of strikes partially successful is larger for the periods of industrial rise. This is shown by the following table:

Years of
Industrial
Decline

Establishments
on Strike

Partly
Successful

%

Wholly
Successful

%

Partly
& Wholly
Successful

1885

  2,284

   217

  9.5

1,206

52.8

62.5

1888

  3,506

   192

  5.5

1,831

52.3

57.8

1893

  4,552

   470

10.3

2,315

50.8

61.2

1896

  5,462

   408

  7.5

3,233

59.1

66.7

Years of
Industrial
Rise

 

1886

10,036

1,892

18.9

3,463

34.6

53.5

1894

  8,196

1,106

13.5

3,122

38.2

51.5

1902

14,248

3,255

22.8

6,741

47.3

70.3

1903

20,244

4,736

23.4

8,274

40.8

64.3

 
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