Dr. Carson has written and taught extensively, specializing in American intellectual history. His most recent book, World in the Grip of an Idea, published by Arlington House, also is available at $14.95 from The Foundation for Economic Education.
Labor unions are an enigma. Their enigmatic character begins to surface as we explore the questions of what they are and what they do. It does not take long to come upon aspects of unions that do not jibe with what they appear or claim to be. Labor unions claim to be organized against employers. In fact, however, they are most basically organized against other workers. Moreover they conceal this contest behind the screen of ideological formulations taken from socialism.
There is more to the enigma than that, however. One way to get to it is to look more closely at the character and functions of unions. In one sense, there is no mystery about what a union is. It is an organization, an organization of workers. When we go beyond that, however, we enter upon confusion. For example, what sort of organization is a labor union? Is it a charity? Is it a fraternity? Is it a business? Is it a government? In short, where does the labor union fit within the spectrum of organizations that are familiar?
In several respects, a union resembles a business. If those who are employed by the union are considered as distinct from the worker members, the union takes on some of the aspects of an agency. That is, those who are employed by the union are representatives or agents of the rank and file members. But what sort of agency? In one of its aspects, it bears some resemblance to an employment agency. In another, it resembles an agency such as actors, writers, and artists sometimes employ to make arrangements for their work. In another, it may resemble an insurance agency, collecting and handling retirement funds. However, a union is not just a business, for it also resembles a mutual aid society or a fraternal organization, and may sometimes do works of charity.
Unions Employ Coercion
Be that as it may, there is one crucial difference between labor unions and the above organizations. It is that unions employ coercion. They have a tendency to compel people to become members, and, when they fail at this, to treat them as if they were. In their efforts to exclude non-union workers or those from other unions, they are monopolistic. And many of the tactics employed in organizing, in boycotting, and in labor disputes are coercive. In their use of coercion, unions resemble government. And it is their use of coercion that brings them into conflict with government.
Indeed, the contest between unions and government is a basic one. Union coercion challenges established government at its foundation. It challenges government’s monopoly of the use of force. A government—any government—is that body which has a monopoly of the use of force within its jurisdiction. If it does not have it, the stage is set for armed conflict.
Union ideology lays claim to a jurisdiction for unions in which government (or other governments) is not supposed to interfere. The argument is usually made oblique-ly- unions do not claim to be governments—and goes something like this. Capital and labor (or management and labor) are the contestants in any labor dispute. Indeed, whatever is in dispute is solely between them. But capital has a large initial advantage in the dispute be cause of the accumulated wealth it represents and the control over the livelihood of workers involved. Not only are individual workers powerless to deal with them but also organized workers unless they are permitted to use the tactics which will enable them to match the power of wealth with the force of their numbers.
Unionists usually draw the battle lines in such a way that it is only possible for government to intrude into the dispute on one side or the other. “You are either for us or against us,” they say, in effect. The basic posture of union leaders has usually been that government should stay out, though they have not been averse to legislation favorable to unions.
Their position came out rather clearly when they testified before the Senate Committee considering amendment of the Wagner Act after World War II. The chairman of the committee accused Walter Reuther of taking the position that “Government should not interfere at all and that we should not pass any laws because the Government should not interfere.” But, the chairman pointed out, there were already laws on the book. To which Reuther replied, “The Wagner Act was remedial legislation to correct a particular abuse. Nobody can deny it was created because American labor in the face of this concentrated wealth could not begin to get the rightful status in American industry around the bargaining table.”
John L. Lewis was asked this question by one Senator: “Do you not think there is a point where the exercise of the right and freedom by any group of individuals impinges so drastically on the rights, privileges, and freedoms of all others that the Government has to step in and do something about it?” Lewis answered, “No, I think definitely the Government should not, Senator, not if you want to preserve America as we know it, and its freedom, because you cannot regulate the human beings who work for a living in this country, and who, in a major sense are not rich and in a substantial sense are quite poor . . . .”
In sum, labor unions claim the right to use coercive tactics. Moreover, they claim a special jurisdiction within which they can employ these tactics. The bounds of that jurisdiction are supposed to be in the organization of workmen and in labor-management disputes. For any government to grant such a jurisdiction is either to recognize unions—or unions in conjunction with management—as having the status of a government or sharing in the powers of existing government. For example, they might be conceived as comparable to a town or city in the United States, incorporated by states to exercise certain political powers but not independent of the states.
No Special Standing
Actually, however, unions have had no special legal standing for most of American history. They were private organizations with no particular power, authority, or re sponsibility. Such rights as they possessed were those belonging to individual members. As one book puts it, “They are voluntary organizations without limited liability and are generally without a personality apart from that of their individual constituent members.” Only one state has required incorporation and, though a Federal law permitted incorporation in the District of Columbia from 1886 to 1932, there was no rush of unions to achieve that status. They were organized into a body, banded together for concerted action, given to using coercive tactics, yet before the law they dissolved into their component parts.
It is not difficult to see why union action brings them into conflict with government. Every resort to coercion is a challenge to government. There is the continuing underlying conflict arising from government’s effort to monopolize the use of force. Beyond that, there are the difficulties unions pose for government in the performance of its basic func tions. Its basic functions are to protect the life, liberty, and property of those within its jurisdiction. To the extent that unions use coercive tactics, they challenge the exercise of these functions.
Contrary to union ideology, labor disputes are not simply a contest between unions and management (hence, nobody else’s business). Basically, unions are organizations of some workers for the purpose of raising the price of labor by excluding competing workers from employment. If there is a strike, and management attempts to operate the struck facility, the visible conflict is usually between strikers and those who are willing to work. Union ideology attempts to conceal the character of the conflict by describing those who would work as instruments of the employer. They are described as “scabs,” “rats,” and “strikebreakers.” This invective helps to obscure, too, a much broader situation that may prevail. There are not only those who do work during a strike but also others who might apply for work and be employed were they not intimidated by the strikers. These are the silent interests in what is billed as a labor-management dispute.
Injury to Employers, Suppliers, and Consumers
To say that the conflict with management is in the background—is secondary, if you will—is not to imply that the owners of facilities may not be harmed by union coercion. On the contrary, there are frequently assorted damages from which government action to prevent or bring a halt to the coercion might protect them. Their property may be trespassed upon. There may be work stoppages because workers are prevented from entering the plant. They may be unable to meet contractual obligations. They may lose business to competitors. They may be unable to pay their bills when they come due. And so on.
A third line of effects extends outward from strikes and boycotts. The flow of commerce may be interrupted. Suppliers may be damaged by the loss of a market. Those dependent upon the struck facility for goods or materials will have to look elsewhere or do without. Transportation facilities may lie idle. A whole category of interdependencies may be disrupted.
A fourth order of effects may also result from union coercion. It is the effect upon consumers. If strikes, boycotts, or other disruptive tactics, succeed in shutting down facilities, goods will not reach the marketplace. Shortages may develop, and prices will rise. If the product is in any way unique, customers will be denied choices. But whether any of this occurs, if unions succeed in raising wages, there will tend to be a rise in prices to compensate for the raise.
Union use of coercion inevitably brings it into a contest with government, then. It challenges the government monopoly of the use of force. Its coercion is exercised against those whom government is committed to protect. The extended effects reach eventually to all the inhabitants of the country.
How Governments Have Responded
Governments in the United States have responded to the challenge implicit in union activity in three ways historically. One writer on labor policy describes them this way: “suppression, toleration, and encouragement.” Until after the passage of the Sherman Antitrust Act in 1890 the federal government had no primary involvement in labor dis putes. The responsibility for maintaining the peace and protecting life and property was exercised by the states. In the few instances prior to the 1890s when the federal government did become involved it was in response to requests from governors of states for military help.
Suppression is too strong a term for describing state action toward unions during the first half century or so of the existence of the United States. Some unions existed throughout this period. However, when cases came before the courts, unions were often found to be guilty of conspiracy either because of coercive tactics or for the exclusion of competing workers from employment. In short, unions had the same right to existence as any private organization, but they could not employ coercion to fix wages or other conditions of employment. For a variety of reasons, and it is not at all clear that their legal status was the most important, unions were usually shortlived and insignificant for the first half of the nineteenth century. There were no nationwide unions and little enough national commerce.
Toleration is imprecise for describing the posture of governments toward unions in the latter part of the nineteenth century (and well into the twentieth, for that matter). It might be more accurate to say that unions were usually ignored until they created some disturbance. At that point, when police or troops were called in, an ad hoc solution was applied. Courts did not generally concern themselves with such effects as the financial impact on workers excluded from employment or those which reached through to the consumer. Indeed, courts restricted themselves largely to trying individuals for acts of violence if and when such cases were brought before them until well into the 1890s.
Unions after the Civil War
Unions did begin to become nationally important after the Civil War. Several national unions were organized, and there were successful efforts to organize workers in many industries. “The Industrial Commission of 1900 reported that there were 22,793 strikes between 1881 and 1900 which affected some 117,000 businesses. During the same period there were 1,005 lockouts.” A lockout occurs when facilities are closed to protect the premises from trespass and the property from damage. The number of them may provide some indication of the fear of destruction during labor disputes.
The union contest with government became visible, vociferous, sometimes violent during this period. The first national instance was the Railway Strike of 1877. This was not a single strike coordinated by a central union but a series of strikes which spread to several railroads and states during that year. The strike began in Baltimore following the announcement of a wage cut on the Baltimore and Ohio Railroad. Crewmen refused to move trains, replacements were hired, and when the strikers remained in the yards, they were arrested. The trouble then shifted to Martinsburg, West Virginia. When the crewmen refused to take the trains through, the railroad asked the governor for troops. When the state troops met resistance they killed a striker and one of them was wounded. The governor requested Federal troops, and several hundred were dispatched. After a change of commander, these were able to get the trains moving again.
Much worse violence lay ahead in Pittsburgh, however. The reduction of wages was not the issue there. The trouble arose over the decision of the Pennsylvania Railroad to haul longer trains by using two engines. Crewmen and yardmen refused to move the train and, when an attempt was made to move it, they attacked it. All train traffic was stopped, and the sheriff wired the governor for troops. Local Guardsmen from Pittsburgh were supplemented by a large contingent from Philadelphia.
When the sheriff, assisted by Guardsmen, attempted to arrest the leaders, shooting broke out, and the Pittsburgh troops threw down their weapons and took sides with the strikers. The Philadelphia Guard withdrew to the railroad roundhouse. “Shut up in the roundhouse, the guardsmen were surrounded by a large crowd that called upon them to surrender. A gun brought by the rioters and loaded with couplings and broken rails steadily pelted the roundhouse, but the guardsmen held out and marched out only when the pickets had pushed burning oil cars against the building. The retreating troops were fired upon as they moved through the streets, and several fell from revolver and rifle shots.” After another day of violence, things quieted down, but trouble was spreading in Pennsylvania.
The governor requested troops from President Hayes. These were dispatched from Baltimore, but “Strikers blocked the road at Altoona and refused to allow National Guardsmen to proceed to Pittsburgh . . . . The governor set up headquarters in Philadelphia, assembled troops and set out for Western Pennsylvania, followed by several hundred regular army troops equipped with artillery.” When a sympathy strike broke out in Scran ton, large damage in mines was anticipated. “A clash between pickets and a posse that had been recruited by the mayor of Scranton resulted in the killing of four and the wounding of several others. Aid was sought from the governor while armed citizens patrolled the city streets. A force of 1,800 men was dispatched and was followed by 2,000 additional troops.”
Trouble spread to Ohio, Indiana, and Illinois. In Chicago, pickets went from one plant to another attempting to make them close down and go out on strike. Pleas from the mayor and governor were unavailing, for “crowds clashed with the police, some of them were killed and many others wounded.” The army was brought in. “Order was restored with the arrest of rioters and their leaders.”
The Haymarket Riot
Surely, these clashes between unions and government were unusual in scope and severity. However, there were instances when clashes were more pointedly ideological than those in the Railway Strike. Perhaps the most well known was the Haymarket Riot in 1886. There were anarchists directly involved in events which led to this series of events in Chicago, men who believed and taught that government was an instrument of capital ists to oppress the workers, that government, then, was an enemy to be overthrown.
Cyrus McCormick, owner of a harvester works in Chicago, had refused to accept a union to represent his employees. When pressed, he closed his factory and opened it later with non-union workers. Conflicts between the union men now on strike and the workers were frequent. Meanwhile, organized labor launched a campaign for the 8-hour day with a general strike. For whatever reasons, probably as a conciliatory measure toward his workers, McCormick granted the 8-hour day and gave his workers a half-day holiday to celebrate. “As the workers came out of the factory they were greeted with hoots of contempt and derision by the union men assembled near by. Not far away, in a vacant lot, striking lumbermen were holding a meeting . . . . The two groups joined forces. The owner summoned the police and, in the fighting that followed, several workingmen were killed and a score or so wounded.”
A protest meeting was scheduled for the next night to be held in Haymarket Square. Circulars were printed up in English and German and distributed over the city. The heading read: “Revenge! Revenge! Workmen to arms!” The body of it spelled out the antagonism toward the police:
Men of labor, this afternoon the bloodhounds of your oppressors murdered six of your brothers at McCormick! Why did they murder them? Because they dared to be dissatisfied with the lot which your oppressors have assigned to them. They demanded bread, and they gave them lead for an answer.
Toward the end of the meeting a squad of police arrived and asked the crowd to disperse. A bomb was thrown into the ranks of the police; the explosion killed one and wounded others. Shooting broke out; sixty-eight policemen were wounded, and seven of them died. Four people in the crowd were killed. In the aftermath several anarchists were tried and convicted of murder.
The Homestead Strike
The Homestead Strike of 1892 provides an example of another aspect of the contest. Companies sometimes hired their own police. When a strike portended, these might be supplemented by private forces such as the Pinkerton Detective Agency. The Homestead (Pennsylvania) plant was a part of Carnegie Steel. Henry C. Frick was the chief ad ministrator. When the Amalgamated Association of Iron and Steel Workers called a strike in 1891, Frick tried to operate the Homestead plant. More than a hundred deputy sheriffs were sent to the site. However, pickets refused to allow them to enter the plant, and the deputies would not force the picket lines. The sheriff managed to get negotiations opened, and the strike was settled.
Things went differently in 1892. Frick caused a three-mile-long fence to be constructed around the plant. The fence was topped with barbed wire, spaced holes were cut in it, and search-lights were mounted along it. When the union decided to strike, the company did ask the sheriff for protection, but Frick did not intend to place much reliance on him. Instead, he had already placed a tentative order with Pinkerton Detective Agency to supply guards, for he had concluded, he said, that “it would be necessary to protect our own property and secure new workmen.”
Three hundred Pinkerton detectives tried to reach the plant by way of boats on the river. However, their approach was detected by the strikers who broke through the fence that had been erected and would not permit them to land. Shooting broke out and several were killed. The Pinkertons made two other unsuccessful assaults before they surren dered. The plant was taken over by the strikers and the guards held captive. The sheriff applied to the governor for troops, and 7,000 were sent. They removed the strikers from the premises, and the mill was eventually reopened without them. In the midst of these developments an anarchist shot and stabbed Frick but failed in the effort to kill him.
The Pullman Strike
The Pullman Strike of 1894 provided the setting for a major shift in dealing with labor disputes. Theretofore, state and local governments had been primarily responsible for maintaining the peace in labor disputes. In this strike, the United States became involved on its own initiative (not simply as a backup force). A contest between a union and the federal government developed. Secondly, it began the shift to the widespread use of the injunction in labor disputes. Third, the Sherman Antitrust Act was invoked in a labor dispute.
Actually, Pullman Strike is a misnomer for the events that brought action by the federal government. There was a Pullman strike, but it was only the approximate cause of the trouble. It could more aptly be called the American Railway Union Boycott. When the workers at the Pullman plant near Chicago went out on strike, the American Railway Union proclaimed a boycott of Pullman cars on trains. That is, the members of their union were not to handle Pullman cars on the train that they worked. The associated railroads which came into Chicago determined that the lines would not be used in that way, that they would continue to use and pull Pullman cars. When the union men refused to comply with company orders, they were replaced by those who would. Many railway workers then struck.
The railroads experienced increasing difficulty in operating. The mail was piling up in some cities because the railroads were tied up by the strike. Injunctions were obtained which enjoined interference with the railroads. A witness described the response to the reading of the injunction this way:
Marshal Arnold stood in a mail car and read one injunction. He was jeered considerably . . . ; then the other injunction was read from the back of a passenger car by his deputy . . . . The men, of course, gathered around and I suppose there were 500 men upon the hill, in the roadway and around the cars . . . . It was from that crowd that the cry came, “To hell with the Government! . . . . To hell with the President! . . . . To hell with the court and injunctions.”
The United States Marshal wired that he was unable to enforce the injunction and requested that troops be sent in. This was done, but the immediate result was an increase in the violence. Several marshals and their resisters were killed and wounded. Shortly after the union leaders were arrested, the violence subsided, and the strike was called off.
The United States Strike Commission, appointed by President Grover Cleveland, described the situation this way in the latter part of the nineteenth century:
It is encouraging to find general concurrence . . . in condemning strikes, boycotts, and lockouts as barbarisms unfit for the intelligence of this age, and as, economically considered, very injurious and destructive forces. Whether won or lost is broadly immaterial. They are war—internecine war—and call for progress to a higher plane . . . . These barbarisms waste the products of both capital and labor, defy law and order, disturb society, intimidate capital, convert industrial paths where there ought to be plenty into highways of poverty and crime, bear as their fruit the arrogant flush of victory and the humiliating sting of defeat, and lead to preparations for greater and more destructive con flicts . . . .
The Commission recommended that the government encourage labor combinations as it had capital formation in the interest of industrial peace.
Except for the railroads and more generally for a brief period during World War I, that would not be the course the government followed for the next four decades. (When the government did eventually turn to the encouragement of unions, as Metz called it—it might better be called empowerment—it hardly resulted in industrial peace.) The contest between unions and government did, however, shift to a different plane between the 1890s and early 1930s. Much of the initiative for maintaining the peace shifted from the police (and armed forces) to the courts. The main instrument for controlling labor unions was the injunction.
The injunction was increasingly used in labor disputes from the 1880s through the 1920s. Both state and Federal courts issued them. A total of 28 such injunctions were issued in the 1880s, 122 in the 1890s, 328 from 1900 through 1909, 446 from 1910 through 1919, and 921 in the 1920s. One authority described the impact of this use of the injunction this way:
For almost a generation and a half, from the 1890s to the early 1930s . . . the power of the courts was invoked to assist in defeating most of the more important strikes—among them, the Pullman Strike of 1894, the coal strike of 1919, the shopmen’s strike of 1922—and only a smaller proportion of the relatively less important ones . . . to prevent the successful spreading of labor boycotts . . . and . . . to prevent organizing activities where the workers were engaged under individual nonunion or “yellow-dog” contracts.
Sherman Act of 1890
The Sherman Act of 1890 provided legislative support to the use of the injunction in labor disputes. It was not essential to the use of the injunction in this way, per se, since courts of equity could, and did, issue injunctions to forestall irreparable damages where they were the appropriate remedy. The Sherman Act went much further, however. It pro hibited combinations or conspiracies which restrained or obstructed interstate commerce. It provided for criminal prosecution, for injunction relief, and for suits in which triple damages could be awarded.
Labor unions were neither exempted from nor specifically mentioned in the Sherman Act. However, a provision to exempt combinations of laborers from its application was not adopted by Congress, and the language was altered to refer not only to trusts but to “other” combinations as well. In any case, the courts began to apply it, and in the Dan bury Hatters case, heard in 1908, triple damages were assessed against a union. The Supreme Court eventually affirmed its validity.
The courts had now moved toward the position that labor unions were at least partially responsible legal entities. The fine in the Danbury Hatters case was levied against the membership of the American Federation of Labor. I say partially responsible, however, for only damage to employers was assessed, not that to non-union workers, to government, or to the general public. Indeed, there may be no way equitably to arrive at such damages. In any case, these developments concerned union leaders greatly. They launched a political campaign to get the antitrust laws modified so as to exempt unions from their applications.
The Clayton Act: “Labor’s Magna Carta”
This campaign bore fruit, or so many union leaders thought, with the passage of the Clayton Antitrust Act in 1914. Section 6 of the Act does appear to exempt labor unions. It reads, in part:
That the labor of a human being is not a commodity or article of commerce. Nothing contained in the anti-trust laws shall be construed to forbid the existence and operation of labor . . . organizations . . . ; nor shall such organizations, or the members thereof, be held or construed to be illegal combinations or conspiracies in restraint of trade, under the anti- trust laws.
Samuel Gompers, head of the AFL, hailed it as “Labor’s Magna Carta,” and declared that it was “the most important and comprehensive measure ever enacted touching the free dom of workers.”
Indeed, the Act may have been a boon to %he freedom of workers,” but it was hardly a victory for labor unions, as matters turned out. Section 20 of the Act did provide that no restraining order should be issued by the courts of the United States in cases involving employers and employees, but there was an exception: “unless necessary to prevent ir reparable injury to property, or to a property right, of the party making the application, for which injury there is no adequate remedy at law . . . .” Section 20 goes on to assert that labor organizations may engage in “peaceful” and “lawful” acts. Many states proceeded to pass acts modeled on the Clayton Act.
What the courts tended to do thereafter was to rule that the Clayton Act made no substantial change in the situation. (It did make one change, for theretofore the government had to initiate requests for injunctions; this power was now extended to private parties.) It had simply declared what was settled law and good construction before it had been enacted. The injunction was more widely used than ever after its passage.
The Clayton Act did not, of course, end, or even reduce, the contest between unions and government. If anything, it sharpened and focused it. One writer says that “The result was that the labor injunction ‘weakened and undermined the courts’ and so respect for law and government, since unions considered the law so unfair and unduly restrictive of their right to self- protection.” Moreover, “they did not prevent the violence which continued to be an accompaniment of industrial disputes.”
In essence, there is a conflict between union coercion and government. The conflict has often been obscured by treating labor disputes as if they were simply something between employers and employees. When viewed in that light exclusively, government action becomes “interference” in a labor dispute. However, when the matter is looked at from the broad perspective of its impact on others, it takes on a different cast. When unions resort to coercion, government becomes a party to the dispute, else it forgoes its monopoly of the use of force. More, if government does not intervene, it does not perform the function which justifies its existence, namely the maintenance of the peace and the protection of life and property. These have been at issue in the union contest with government. 
Besides their vital interest in eliminating as much competitive labor as possible and expanding job opportunities to the greatest possible extent for their own members, union leaders are driven by one more unremitting goad: they must keep alive the destructive myths and superstitions upon which class-warfare thrives.
If the union leaders for one moment admitted to their members the obvious truth that employers and employees are bound together by the strongest bonds of mutual and reciprocal self-interest known to mankind—perhaps exceeding even the family bond—the party would be over as far as the union leaders were concerned.
Sylvester Petro, “Unemployment, Unions and Inflation”