1950s >> 1956 >> no-624-august-1956

How Capital Influences Strikes

Strikes in industry are not always an evil to the employing class. When the markets for goods in a particular industry are over-stocked, a strike can be useful to the Capitalists by saving them the trouble of putting workers off and cost of paying those kept on. Hence the best time for workers to strike is during a boom, and the worst time during a slump. Also it is better to strike suddenly than after protracted negotiations which enable the employers to take steps to minimise the embarrassment to themselves. On the same ground long no-strike agreements are harmful because the employers can stockpile against trouble.

These remarks are inspired by a report from the Washington correspondent of the Observer (8/7/1956). This report refers to the strike in the American steel industry over “the length of the contract to be signed between the union and the temporarily united management of the main American steel producers” The report points out the union appears to have been forced to choose a bad time for the assault. The report adds that: “Management insist on a four-year-and-four-month contract—labour would probably settle for three years.” The report then follows with statements which illustrate the folly of any long agreements:

“This strike was foreseen, as the labour-management contract expired at the end of June. Industries dependent on steel have been stock-piling against this emergency. It is not known how heavy these ‘inventories’ are, but it was significant that steel sales were maintained this year, even though the automobile industry and the construction industry suffered a noticeable recession.”

“The strike, curiously, comes to the Administration as yet another gratuitous and unearned blessing. It was generally expected that in the third quarter of this year the American economy would suffer a noticeable recession. Plant construction has been running at a level that few thought could be maintained. Motor-cars were expected to be still less saleable in the months before the unveiling of what are said to be revolutionary new models.

“If the strike lasts a month, as is expected, it will drain off some embarrassing surpluses. It is also expected with more certainty—to be followed by a production boom. This was the case after the eight-week steel strike in 1952. “This boom will delay the testing of the economy. It will also approximately and conveniently coincide with the election. It will provide an artificial stimulus to the economy at a time when most economists expected a slump.”

This is a striking example of how the dice is loaded against the workers and how Capitalist ownership of the means of production and distribution weights the scales in the conflicts between workers and Capitalists.

Gilmac