This winter’s pre-holiday labor standoff that nearly resulted in a national freight-rail strike taught some valuable lessons about America’s political economy in the early 21st century; it also spelled out in depressing detail the deteriorating relationship between labor and the Democratic Party that’s evolved over the past 40 years.
Let’s start with a commonplace observation. Joseph R. Biden Jr. is, in his own estimation at least, “the most pro-union president you’ve ever seen.” It’s his self-proclaimed brand, nurtured over a decades-long career in politics. The only problem is the label is the president’s own, not one conferred on him by the labor movement or by the 70% of Americans polls say favor unions.
To be sure, the current occupant of the White House possesses some labor credibility. His appointment of progressive Boston Mayor Martin J. “Marty” Walsh, a onetime union president, as secretary of Labor, was symbolically important, but Walsh recently gave notice that he will leave his post in mid-March to become executive director of the National Hockey League Players' Association, and most of Biden’s pro-labor posturing has been just that — posturing — and more rhetorical than actual. His verbal encouragement of union organizers at Amazon and Tesla, for example, cost him nothing, nor did requiring union wages on selective federal construction projects, a pro-forma rite performed by all recent Democratic presidents.
Labor icon Eugene V. Debs (1855-1926), founder of the pioneering American Railway Union and leader of the famous Pullman-car strike of 1894, the first great railroad job action, would not have been impressed. He, too, dealt with a Democratic administration, that of Grover Cleveland, which, when push came to shove, also prioritized industry’s interests over those of rail workers. Cleveland and his pugnacious attorney general, Richard B. Olney, unhesitatingly used federal troops to break the historic Pullman strike.
Biden didn’t have to do that; he had the Railway Labor Act of 1926, an obscure law giving Congress the power to intervene upon request and end disruptive rail strikes. The principle, however, was the same: suspending collective bargaining and taking away the normally inviolable right to strike in the name of economic efficiency and public tranquility.
Modern rail workers, however, have unique grievances that differ from those of the past. When Debs’ Railway Union struck in the 1890s, the concern was all about pay equity; his membership was actually enduring severe wage cuts imposed by a profitable company in an era of economic depression.
Today, railroad employees are well compensated, but there are other issues on the table: reductions in staffing, punishing work schedules, restrictive workplace policies, and, above all, the inability to obtain time off for routine paid medical care and family emergencies. Like many contemporary workers seeking to unionize (Amazon's warehouse employees, for example), today’s rail workers are most angry about stressful working conditions created by a heedless management.
Rather than letting the situation play out, the Biden administration brokered a tentative deal aimed at preventing a strike that included the carrot of additional pay increases. By majority vote, rail workers rejected the deal, which failed to address the priorities of health care and work schedules, and proposed to walk out. Biden then urged congressional intervention under the Railway Labor Act by a Congress happy to oblige, forcing union acceptance of an emasculated contract minus the key demand of paid sick leave (which would have required an unattainable, filibuster-proof Senate amendment) and leaving a Democratic president, House and Senate on record as opposing organized labor. (One rail line, CSX, has since reached a negotiated agreement on paid health coverage with three of the 12 railway unions.)
How did this sad state of affairs come to pass? The answer requires a look back into railroad history. The American rail industry as it exists today is the product of over 100 years of evolution from unregulated private enterprise to government management and operation, and back again.
At the start of the 20th century, America’s rail-freight industry was dominated by successors to the original robber barons of the Gilded Age (Gould, Morgan, Harriman, Hill, et al.) under the nominal supervision of a toothless Interstate Commerce Commission (ICC), established in 1887, whose powers were severely circumscribed by conservative federal courts. Two-thirds of track mileage and 85% of rail earnings were monopolized by seven regional groups led by the Vanderbilt New York Central system, each of them intertwined with banking and financial interests.
These interlocked transportation oligopolists ran the national rail network to suit themselves with little public oversight and ran it more or less into the ground. The emergency of World War I was a critical turning point, causing the federal government to step in and take over the mismanaged system for the duration, temporarily realizing the long-held dream of America’s populists and progressives for rail nationalization. (From the People’s or Populist Party platform of 1892 to that of Robert LaFollette’s Progressive Party in 1924, government ownership of the railroads remained a key demand.)
The Wilson administration operated the railroads efficiently for over two years (December 1917-March 1920) under the direction of the US Railroad Administration; it modernized and improved them, unified the system, and rewarded the long-abused rail workers with increased wages and the benefits of an eight-hour day and overtime pay.
The railroads were then returned to their private owners, but with an end to laissez-faire operation. Presented with a choice of making government ownership and operation permanent (as political progressives and the railway unions preferred), reinstating the old prewar private system, or devising a regulatory compromise, the Wilsonians chose the third option.
The Transportation Act of 1920, an amendment to the Interstate Commerce Act, resuscitated the moribund ICC and gave it authority to divide the country into consolidated rate districts, set minimum and maximum rail-freight rates, and protect and preserve smaller, weaker rail lines. Government control and direction under the ICC subsequently became the salient feature of America’s freight-rail industry from 1920 to 1970.
This is where things stood with the rail system as the US transitioned to the era of economic conservatism that followed the Kennedy-Johnson years. It was a transition with dire long-range consequences for rail transportation in America and, especially, for the railroad workers bearing the brunt of the change on the front lines; it’s one we’re still living with, as December’s aborted rail strike attests.
(Next time: Who wrecked the rail system? Hint: It wasn’t the James gang.)
Wayne O’Leary is a writer in Orono, Maine, specializing in political economy. He holds a doctorate in American history and is the author of two prizewinning books.
From The Progressive Populist, March 15, 2023
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