VIEWS OF PRESIDENT HARDING

(From his address to Congress, August 18, 1922.)

The public menace in the coal situation was made acute and more serious at the beginning of July by the strike of the federated shop crafts in the railroad service-a strike against a wage decision made by the Railroad Labor Board, directly affecting approximately 400,000 men. The justice of the decision is not for discussion here. The decision has been lost sight of in subsequent developments. In any event, it was always possible to appeal for rehearing and the submission of new evidence, and it is always a safe assumption that a government agency of adjustment deciding unjustly will be quick to make right any wrong.

The Railroad Labor Board was created by Congress for the express purpose of hearing and deciding disputes between the carriers and their employees, so that no controversy need lead to an interruption in interstate transportation.

It was inevitable that many wage disputes should arise. Wages had mounted upward, necessarily, and justly, during the war upheaval, likewise the cost of transportation, so that the higher wages might be paid. It was inevitable that some readjustments were resisted. The administrative government neither advocated nor opposed: it only held that the Labor Board was the lawful agency of the Government to hear and decide disputes, and its authority must be sustained, as the law contemplates. This must be so, whether the carriers or the employees ignore its decisions.

Unhappily, a number of decisions of this Board had been ignored by the carriers. In only one instance. however, had a decision, challenged by a carrier, been brought to the attention of the department of justice, and this decision was promptly carried to the courts and has recently been sustained in the federal court of appeals. The public or the executive had no knowledge of the ignored decisions in other cases because they did not hinder transportation. When these failures of many of the carriers to abide by decisions of the Board were brought to my attention, I could more fairly appraise the feelings of the strikers, though they had a remedy without seeking to paralyze interstate commerce.

The law creating the Railroad Labor Board is inadequate. Contrary to popular impression, it has little or no power to enforce its decisions. It cannot halt a strike, and manifestly Congress deliberately omitted the enactment of compulsory arbitration. The decisions of the Board must be made enforceable and effective against carriers and employees alike. But the law is new, and no perfection of it by Congress at this moment could be helpful in the present threatened paralysis of transportation.

Happily, it is always lawful and oft-times possible to settle disputes outside of court, so, in a desire to serve public welfare, I ventured upon an attempt at mediation. Those who had preceded in attempted settlements had made some progress. I submitted to the officials of the striking employees and the chairman of the Association of Railway Executives, in writing on the same day, a tenative proposal for settlement. Knowing that some of the carriers had offended by ignoring the decisions of the Board and the employees had struck when they had a remedy without the strike, I felt it was best to start all over again, resume work, all to agree to abide faithfully by the Board's decisions, make it a real tribunal of peace in transportation, and everybody serve the public. The barrier to be surmounted was the question of seniority. By the workmen these rights are held to be sacred, and unsurrendered by a strike. By the carriers the preservation of seniority is the weapon of discipline on the one hand and the reward of faithful employees on the other. It has been an almost invariable rule that when strikes have been lost seniority and its advantages have been surrendered; when strikes have been settled seniority has been restored.

In the tentative proposal which I sponsored, it was provided that everybody should go to work, with seniority rights unimpaired, that there should be no discrimination by either workmen or carriers against workmen who did or did not strike. I realized that the proposal must carry a disappointment to employees who had inherited promotion by staying loyally on the job, and to such new men as had sought jobs looking to permanent employment, but I wanted the fresh start and maintained transportation service, and I appraised the disappointment of the few to be less important than the impending misfortune to the nation. It was not what I would ask ordinarily to be considered or conceded, but at that moment of deep anxiety, with the coal shortage gravely menacing, I was thinking of the pressing demands of the welfare of the whole people. I believed the sacrifice brought to the men involved could be amply compensated for by the carriers in practical ways. I believed that the matter of transcendent importance was the acceptance of the proposal to respect the Labor Board's decisions on the questions which formed the issue at the time of the strike. The public compensation would be complete in guarding by law against recurrence. The proposal was rejected by the carriers. Though the rejection did not end all negotiation, it left the government only one courseto call the striking workmen to return to work, to call the carriers to assign them to work, and leave the dispute about authority to the Labor Board for decision. When negotiation or mediation fails, this is the course contemplated by the law and the government can have no chart for its course except the law.

To this call a majority of the carriers responded favorably, proposing to re-employ all strikers except those guilty of violence against

workmen or property, to restore the striking workmen to their old positions where vacant, or to like positions where vacancies are filled; questions of seniority which cannot be settled between the employer and employees to go to the Labor Board for decision. The minority of the carriers proposed to assign jobs to workmen on strike only where the positions were vacant. Neither proposal has been accepted.

Thus the narrative brings us to include the developments which have heightened the government's concern. Sympathetic strikes have developed here and there, seriously impairing interstate commerce.

Deserted trans-continental trains in the desert regions of the southwest have revealed the cruelty and contempt for law on the part of some railway employees, who have conspired to paralyze transportation, and lawlessness and violence in a hundred places have revealed the failure of the striking unions to hold their forces to law observance. Men who refused to strike and who have braved insult and assault and risked their lives to serve a public need, have been cruelly attacked and wounded or killed. Men seeking work and guards attempting to protect lives and property, even officers of the Federal Government, have been assaulted, humiliated, and hindered in their duties. Strikers have armed themselves and gathered in mobs about railroad shops to offer armed violence to any man attempting to go to work. There is a state of lawlessness shocking to every conception of American law and order and violating the cherished guarantees of American freedom. At no time has the Federal Government been unready or unwilling to give its support to maintain law and order and restrain violence, but in no case has State authority confessed its inability to cope with the situation and ask for federal assistance.

Under these conditions of hindrance and intimidation there has been such a lack of motive power that the deterioration of locomotives and the non-compliance with the safety requirements of the laws are threatening the breakdown of transportation. This very serious menace is magnified by the millions of dollars in losses to fruit growers and other producers of perishable foodstuffs, and comparable losses to farmers who depend on transportation to market their grains at harvest time.

Even worse, it is hindering the transportation of available coal when industry is on the verge of paralysis because of coal shortage, and life and health are menaced by coal famine in the great centers of popuation. Surely the threatening conditions must impress the Congress and the country that no body of men, whether limited in numbers and responsible for railway management or powerful in numbers and the necessary forces in railroad operation, shall be permitted to choose a course which so imperils public welfare. Neither organizations of employers nor working men's unions may

escape responsibility. When related to a public service the mere fact of organization magnifies that responsibility and public interest transcends that of either grouped capital or organized labor. Another development is so significant that the hardships of the moment may well be endured to rivet popular attention to necessary settlement. It is fundamental to all freedom that all men have unquestioned rights to lawful pursuits to work and to live and choose their own lawful ways to happiness. In these strikes these rights have been denied by assault and violence, by armed lawlessness. In many communities the municipal authorities have winked at these violations, until liberty is a mockery and the law a matter of community contempt. It is fair to say that the great mass of organized workmen do not approve, but they seem helpless to hinder. These conditions cannot remain in free America. If free men cannot toil according to their own lawful choosing, all our constitutional guarantees born of democracy are surrendered to mobocracy and the freedom of a hundred millions is surrendered to the small minority which would have no law.

It is not my thought to ask Congress to deal with these fundamental problems at this time. No hasty action would contribute to the solution of the present critical situation. There is existing law by which to settle the prevailing disputes. There are statutes forbidding conspiracy to hinder interstate commerce. There are laws to assure the highest possible safety in railway service. It is my purpose to invoke these laws, civil and criminal, against all offenders alike.

The legal safeguarding against like menaces in the future must be worked out when no passion sways, when no prejudice influences, when the whole problem may be appraised and the public welfare may be asserted against any and every interest which assumes authority beyond that of the government itself.

OPINION OF ROGER W. BABSON

The students of labor problems are divided into two distinct groups: one group believes in compulsory arbitration as illustrated by the Kansas industrial court, and the other group stands purely for conciliation without any compulsion. Conservatives and radicals can be found in both groups. Investigation leads me to believe that there is a field for both of these lines of work. Labor disputes in connection with general industries, such as the textile industry, the boot and shoe industry, and possibly the steel industry, should be kept on a conciliation basis. It surely would be a mistake to attempt compulsory arbitration in connection with these businesses which are operated solely for profit. The best means of avoiding trouble in these industries is by keeping these industries in two major groups, one group to be strictly "union"

and the other group strictly "non-union." Let the union group adopt the closed shop and let the other group be strictly non-union. Then let the two groups compete. I do not mean necessarily in production, but rather see under which system the public, the employes and the stockholders, all combined, are most prosperous. My own guess is that none of these three parties would long be healthy, happy and prosperous with all "union" or with all "non-union." When one group secures control, it becomes inefficient, careless and arrogant. My guess is that an industry would be most prosperous and all concerned in it would be rendering the most service and be happiest if the industry were equally divided into a union and a non-union field. So much for general industry. When disputes arise, only conciliation should be applied by a third party. There should be no compulsory settlements in such cases.

When, however, we come to transportation, fuel, public utilities, such as water, light and gas, or to the distribution of milk, bread, etc., we find a group of industries to which compulsory arbitration must be applied. The first two groups to which strong-arm methods will be applied are the railroads and coal mines. First let me say that the railroads and the mine operators are themselves largely to blame for present troubles. Although the owners of these properties are now behaving themselves, they have not always done so. Most of the unwise methods that labor leaders are using today were applied by the railroads and mine operators of twenty years ago. Hence these corporations now are only reaping what they have sown. Nevertheless, two wrongs do not make a right. Our nation must have transportation and fuel at a fair rate and the operation of its railroad and coal properties must be undisturbed by either labor leaders or stock market operators. Regarding the railroad situation; to secure a fair rate the interstate commerce commission is functioning very well, and the strug

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gle is now over the railroad labor board.

Experience has shown that boards consisting of three groups (one group representing capital, one group representing labor, and one group representing the public) do not function well. The group representing capital vote in one body for the corporations; the group representing labor vote in one body for the wage workers; this leaves the decision to the three men who represent the public. The problems involved are too great to permit leaving the decision to three men chosen more or less for political reasons. To have the railroad labor board or any other such board properly function, five, seven, or nine men should be selected who represent neither the corporations nor the wage workers, but who represent the nation. These men should be paid large salaries, given dignified positions, appointed either for life or long terms, and treated like the Supreme Court of the United States. These men should gradually build up a code based upon their rulings, seeking the advantage of no one group, but rather the welfare of the