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Jack Ranger

Tapping the Wall Street Wire

Those Portal Pay Suits

(10 February 1947)

From Labor Action, Vol. 11 No. 6, 10 February 1947, p. 2.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

This isn’t going to be a survey of the portal suits filed in the last few months against industry by various unions. By now the suits total several billion dollars; the steel workers alone are asking $1 billion. There is no question but that the workers are entitled to pay for the time they are forced to spend on company property going to and from work and making ready. What I want to comment upon is the way the entire governmental apparatus has leaped to the defense of Big Business in this situation. The Justice Department has filed a brief with the U.S. District Court of Michigan asking for dismissal of the portal-to-portal pay suits, on grounds that “legal history has established the rule that courts do not deal with trifles.” The billions due the Workers are considered a “trifle” by Attorney General Clark.

Clark also argued that to make employers compute employable time in terms of minutes, rather than hours, “would create a burden on the company greater than the benefits to be conferred upon the workers.” Not that the Justice Department isn’t concerned with the welfare ‘of the workers. Clark argued that “close observation of the activities of workmen,” that is, keeping track of the minutes of overtime due them, would be “humiliating,” and that the companies would be inclined to cause “Speed-ups,” which would impair the health of workmen, etc.; etc. ... If you want to beat a dog, it is enough to say he ate the frying pan, as the old proverb goes ...

The Treasury Department has also rushed to protect the bosses, by issuing a ruling that any money paid out by industry to its workers for back portal pay may be deducted from industry’s taxes. This ruling has the effect of turning the portal pay issue into a fight between the unions and the government, and, incidentally, of “stiffening industry’s spine to resist union demands,” according to the >Wall Street Journal>.

Congress isn’t inactive in this situation, either. The Senate judiciary committee has cleared the decks for fast action on the numerous bills introduced by public-spirited Congressmen, designed to outlaw portal suits. Slick attorneys for Big Business are suggesting that “a simple revision of the wage law, redefining the hours-worked clause,” can be made retroactive without violating the Constitution’s prohibition against ex post facto laws – that is, laws passed after the event.

It is useless to judge these portal suits from the legal or Constitutional viewpoint. The bosses have the power to pass any law they wish and to make it constitutional. For they own the government. It is their people, their political parties, that run the state. Why should the state decide a case like this in favor of the workers, who haven’t ONE SINGLE LABOR REPRESENTATIVE IN CONGRESS, who haven’t even got a Labor Party yet? If I were a Worker in a union which has filed a portal suit, I sure wouldn’t spend any of the green stuff until it was laid in my hand.

A typical industry spokesman appearing before the Senate judicial subcommittee hearing testimony on legislation to block the portal suits, was Thomas F. Patton, general counsel of the Republic Steel Corporation. Patton, owl-eyed, serious, told the committee that the effect of the Supreme Court decision in the portal suit is to pervert the fair labor standards act, “an instrument of righteous correction against sweatshop employers, into an instrument to destroy the. great majority of industrial employers in this country.” Payment of the money due the workers, he said, would have “a disastrous impact on public finances,” and would “ruin” the employers. Patton defied the courts to force industry to pay any money to employees for back pay due them. He said that if a bill were passed “regulating” (that is, outlawing) portal pay claims, “any agreement forced on employers by court misinterpretation of the act in the past would not continue to be binding.”

But Patton, like the Attorney General, has got our interests at heart. If the liability of the bosses to fork over this dough were removed, he said, it would not be unfair to employes but “would merely prevent them from obtaining a windfall which would ruin the industry that furnishes their employment.” Another lawyer, William C. Chanter, appearing for the aircraft industry, sobbed that “the aircraft industry faces complete and utter disaster if portal-to-portal claims are allowed or compromised.”


Business Notes

Business inventories continued to rise during November, by $1.1 billion, at all levels – manufacturers, wholesalers arid retailers. Finished goods stocks held by manufacturers totaled $19.9 billion on December ... The New York Dairymen’s League, which rigged the butter market and thus made millions of dollars for its members, got off with a fine of $25,000 in federal court, after entering guilty pleas. At that price, the league can afford to rig the market every day and twice on Sundays ... Ligget & Myers Tobacco Co., which upped the price of Chesterfields 50 cents a thousand in the past year, found that it paid off. The company reports 1946 net income of $16.9 million, equal to $5.39 a share, compared with 1945 earnings of $13.4 million, or $4.30 a share. Year-end inventories were up $41.3 million compared with 1945, a record high level.

Swift & Co., one of the big meat packers, “Can look forward to a favorable year,” said John Holmes, president, to his stockholders recently. He acknowledged that “meat pipelines are filled up.” How quickly the meat got to market when the meat trust wanted to sell it ... Another packer, John Morrell & Co., also had a good year, with earnings of $5.26 a share in 1946, compared with earnings of $2.58 in 1945; in addition, surpluses rose over $1 million, and inventories were up over $2 million at the end of the year, compared with 1945.


Government economists figure that deflation is here. Unemployment now totals over 2,000,000, and is expected to at least double before the end of the year. They point out that consumers’ savings have shrunken drastically, under the impact of high prices ... Because the workers wages won’t begin to buy back the mountain of goods he produces, the loan sharks are preparing to help us out during the coming year, by financing our installment buying. During 1946, consumer credit of all kinds mushroomed over $2 billion to a total near the 1941 record of $10 billion. This year it will soar to $15 billion, say the loan sharks. These bankers admit that veterans and other low-income groups are now “priced out of the market,” and that the only chance they have to buy a new refrigerator or car is to buy it on time.

Banks now have $320 million in direct auto financing and $200 millions through dealers, compared to only $80 million and $55 million in 1941. C.W. Bailey, president of the American Bankers Association, says that personal loans outstanding are now at an all-time high, higher than in 1941. “We have about half the number of loans we had in 1941, but the average loan today is twice the average of 1941. The dollar won’t go as far as it did five years ago, so people are required to borrow in larger amounts. The reason for borrowing, in the majority of cases, is for necessities, paying off bills, borrowing to live, if you please.” Bailey is a little worried. “If a lot of people now find it necessary to borrow for routine living expenses, they won’t have either money or credit when the supply of durable goods comes along,” he says. It is men like Bailey who are the first to condemn the demands of unions for higher wages, or for portal pay.

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