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The New International, March 1935


Jack Wilson

In a Billion Dollar Industry

From New International, Vol. II No. 2, March 1935, pp. 69–70.
Transcribed & marked up by Einde O’Callaghan for ETOL.


AMERICA’S billion dollar rubber industry is an outstanding example of the development of monopoly – controlled by finance capital – over the country’s basic productive forces, which has been forced by its inherent nature to find its highest expression in ruthless imperialism.

The industry has expanded in two decades from a few small factories located in Akron, Ohio, to giant corporations having plants throughout the world from Japan to India to Spain and South America. It has subjugated Liberia into slavery, fought against British and Dutch imperialism over the East Indies in its pursuit for crude rubber and raw materials.

When the world war broke out, the rubber industry received the same impetus as steel for its growth, with the insatiable demands for its products, in particular gas masks and other actual war equipment. Government subsidies, chiefly in the form of unbelievably high prices for products, left the tire industry in an excellent financial position and saw Akron grow from a mere town of 50,000 to an industrial center with over 200,000 population. During this period Akron men, entrepreneur capitalists, controlled the industry.

The post-war depression gave New York capital its opportunity to seize control from the Akron men – an example is F.A. Seiberling, founder and builder of Goodyear, whose $150,000,000 company was taken by Dillon, Reed, of Wall Street, because of unpaid loans.

British control of crude rubber plantations which sent prices shooting to as high as $1.14 a pound with the Stuyvesant act of 1924 forced the industry to seek its own raw material sources. This epoch was culminated with the building of a million acre plantation in Liberia for the Firestone Co. in 1927. Financial control over the country was given to Firestone by the League of Nations upon the insistence of the American government. The slavery of the people – against which even an Episcopal bishop protested – followed.

The tremendous boom in the automobile industry in the ‘Twenties was followed by a similar expansion of the tire industry which depends in a large part on the auto industry (their seasonal booms and depressions, their cyclical curves of business activity, run parallel). It was in this period that tire production trebled to reach 90,000,000 million yearly and that plants began to sprout throughout the country.

Small companies nourished until over 200 of them were in business. Meanwhile Goodyear was using surplus profits to build plants in Los Angeles, Canada, Gadsen, Georgia, Buenos Aires, Wolverhampton, Eng. and elsewhere. Goodrich and Firestone followed this same path. An idea of the immense amount of surplus value stolen from labor can be had when it is realized that monetary wages – about $1,500 average per worker yearly – remained the same throughout this period, while tire prices followed other commodity prices in the upward leap during the inflationary period. Better yet, at Goodyear alone, 30,000 workers in 1920 built 30,000 tires, while in 1930 16,500 workers built 50,000 tires! And the wages remained the same.

The other company of the “Big Four”, the United States Rubber Company, used a more advanced capitalist technique to rise to first place in the rubber world. Through holding companies, etc., it seized control of over 34 companies and had assets of over $350,000,000. With the beginnings of business recessions in 1927, the Big Four used ruthless price-cutting to ruin the small companies of which only nineteen of any consequence exist today. This process was accentuated with the depression.

Until the Roosevelt regime, the rubber industry, enmeshed in financial difficulties, was unable to continue its profit-making to any extent despite successive 10% pay cuts, with the exception of Firestone who proudly announced in 1931 that his company made $4,000,000 by cutting wages! Under the benevolence of Roosevelt the companies – i.e. the Big Four – have announced profits of an average of $4,000,000 apiece yearly. Two 10% wage increases were given, but these were followed by two 20% increases in tire prices; and living costs, of course, have advanced about 25% in Akron so that labor today receives much less than it did before the New Deal – as in every other industry.

During the rise of the rubber industry labor made numerous attempts to gain more of its share of the product it was creating. In 1913, under IWW leadership, a general strike in Akron brought pay increases. Bill Haywood was one of the leaders in this fight of labor, which was met with vigilante committees, wholesale terrorism through beatings, and utilization of strikebreaking agencies. Goodyear even set up a Goodyear Industrial assembly in 1914 as a sop. This company union still exists and is a factor here which splits labor forces. Walkouts of departments marked the period from 1920 to 1932. In fact, in 1927 the Proletarian Party captured control of the Goodyear union and lead a walkout which was broken, since only 200 workers joined. In general, however, the firing of any militant, the recruiting of raw labor from the backward sections of the South, and the failure of any organized labor group to try to unionize the workers, made the boast of the Chamber of Commerce that “Akron is the most open shop city in America” true.

The Communist Party has had an organizer and a small following since 1921, but disastrous policies, poor leadership and the objective conditions have kept it a negligible factor. A more thorough analysis of the CP position today will be made later.

The advent of the NRA found the 80,000 rubber workers in the industry in a dangerous mood. Years of seasonal lay-offs, brutal speeding up – as was shown statistically – the oppressive atmosphere of the working surroundings which smell of sulphur and are filled with sulphur dust, the wage cuts, the day and night work (shifts are employed continuously for 24 hours daily) and the depressed condition of their living as the depression squeezed down their existence level – these conditions, prevalent in America and accentuated here, aroused labor.

Under rank and file leadership, unions rose here from nothing until it could be safely claimed that nearly 40,000 workers were unionized. Not until the rubber workers were almost at the height of their strength did the AF of L take action. Then Coleman C. Claherty, special organizer appointed by Green, came to Akron, and charters were granted to the locals. Claherty was a craft unionist, a sheet metal organizer, and he followed the AF of L policy of building crafts. Charters were thus given to 25 craft unions.

In the spring of 1934 the AF of L had two fights on its hands. First, the rubber workers demanded strike action and repeatedly tried to pass motions to that effect in the locals. They wanted results but Claherty, the only experienced and clever politician, backed by Green, was able to forestall action. Second, the rank and file leaders who organized the unions, wanted industrial unions and an international.

Sentiment for industrial unions and an international was so strong that a year ago January the unions from plants throughout the country sent 200 delegates to a “rump” convention, unsanctioned by the AF of L, to form a rubber workers’ international. This was smashed by Claherty and Green who expelled the leaders from the unions. The two real leaders, Frederick L. Phillips, former financial secretary of the Goodrich local, and Clark C. Culver, financial secretary of the Goodyear local, have since been unable to find work at any plant and have had their characters assassinated by Claherty. Promise of a sanctioned convention later and of immediate action in negotiations with the rubber barons helped Claherty swing enough support to continue his dictatorship.

Threat of a strike at the India Rubber Co., near Akron, brought union recognition and small wage increases last February. Refusal of the big companies even to discuss possible negotiations with the union delegations brought bitter resentment last May, but huge inventories and the arrival of the slack season helped Claherty curb the militants. However, 1,100 rubber workers at the General Tire Company, impatient with the AF of L and realizing they must strike immediately to win anything, walked out spontaneously early. in June and held a strong picket line for six weeks, forcing the AF of L to back them. They gained a partial victory. The excellent financial and picket line support other unions gave the strikers was significant. It showed that labor understood the need for solidarity. Labor, previously inexperienced, was learning.

When the AF of L called a national rubber workers’ convention last June, delegates were selected by crafts so that the actual rubber workers’ unions having 90% of the workers in them, were in a hopeless minority. Claherty was able to set up an executive council of seven members only one of whom was an actual rubber ‘ worker. The other six were craftsmen. Claherty had himself elected president. Akron locals were given two offices, having ex-officio membership in the council, as a sop.

However, the Akron locals were able to force two concessions from the AF of L since the convention set up the United Rubber Workers’ Council as governing body. One was the adoption of a law that craft unionists should also join the rubber workers’ local, and the other was the creation of a subordinate council, composed of delegates from the Akron rubber workers’ locals, which has power over them.

The fall of 1934 found the rubber workers’ unions in a precarious position. The Firestone local, which had 75% of the 9,000 employees as members, dropped to not over 2,000 membership. The Goodrich local, having 8,000 out of 9,500 workers organized at its peak (it was and is the strongest union), saw its membership fall to less than half. The Goodyear local, at best with 75% of the 12,000 employees unionized, was down to not more than 2,000 members. The ordering of employee elections at Goodrich and Firestone last December brought many workers back to the folds. Goodyear local leaders were afraid to pit their strength against the 21-year old company union. Of course the companies tied the elections up in federal court where they are still pending. Two weeks later Firestone laid off 325 workers who were the backbone of the union. A strike vote was taken but defeated through Claherty’s machinations, for he is deadly afraid of the companies, if not in their pay. Instead the AF of L promised action through the labor boards. It has begun an absurd campaign to take away the blue eagles of the company. That is their strategy despite Roosevelt’s open rejection of them as class allies.

This action has nearly killed hope of an industry-wide strike for this spring. Progressive forces which sought to compel a strike were defeated by Claherty at a recent meeting of the subordinate council. Membership in the unions continues to fall after the adoption of the class collaboration policy.

Having thus elected to complete its betrayal of the rubber workers, the AF of L reactionary leadership stands exposed to the progressive elements and the workers at large and stands at the threshold of its doom. Personal criticism of Claherty is so outspoken and great at local meetings that his removal seems a foregone conclusion. A strong rank and file “union within the union” under progressive leadership at Firestone threatens to take the entire membership with it away from the AF of L. As though Green and company weren’t having enough trouble with progressives in steel and the textiles and the auto industries, this additional headache keeps the bureaucrats awake at night. It is entirely possible here that a spontaneous walkout like the one at the General Tire company will happen any day. Again the AF of L bureaucrats will be put on the spot.

It is evident that the chief difficulty of the workers has arisen from their inexperience in fighting bureaucrats like Claherty, and in their not having a correct perspective for their future. There is no unification of progressive elements in the various plants. This must be the major task of the Workers party in Akron. Numerous contacts, a good role in workers’ education circles here; and a-thorough grasp of the situation are the assets. Likewise we must pose the question of strike leadership if such action is taken by any of the locals. A weakness in numerical strength must be overcome by the branch so that it can play a decisive role in the labor movement in the rubber industry. The Stalinists have been and are almost completely isolated from the rubber workers’ unions. One of the greatest fields for the growth of the Workers Party in America toward the revolutionary overthrow of capitalism is open to us. We must go forward, armed with the keenest weapons of Marxism, to victory. The future of the working class and its allies is at stake.

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Last updated on 26 February 2016