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Union Politics and Postwar Liberalism in the United States, 1946–1979

Published online by Cambridge University Press:  16 December 2008

Karen Orren
Karen Orren
Affiliation:
Universlty of Califomia, Los Angeles
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Extract

It is evident now that the political structures built in the United States over the last half-century depended for their successful functioning on a set of international conditions that no longer exist. The government programs of the 1930s to protect labor organization, promote high agricultural prices, and provide cheap credit would have caused, had the gold standard not been defunct, massive gold outflows, worsening the already severe economic contraction. The postwar offspring of these programs have multiplied under conditions of international trade and finance that in effect permitted the export of excess economic demand. For the last decade, with international circumstances less obliging, the task of whittling government down or at least controlling its growth has vexed successive administrations.

Type
Research Article
Information
Studies in American Political Development , Volume 1 , Spring 1986 , pp. 215 - 252
Copyright
Copyright © Cambridge University Press 1986

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References

An early version of this article was presented at the 1982 convention of the American Political Science Association. I am grateful to Jeff Frieden, Paul Quirk, Ron Rogowski, Stephen Skowronek, and John Woolley for their comments during revision.

1. The “classic” statements of interest-group liberalism are found in McConnell, Grant, Private Power and American Democracy (New York: Knopf, 1966)Google Scholar; and Lowi, Theodore J., The End of Liberalism (New York: W. W. Norton, 1967)Google Scholar. A discussion of the related corporatist view is found in Anderson, Charles W., “Political Design and the Representation of Interests,” Comparative Political Studies 10 (04 1977): 121–52CrossRefGoogle Scholar. For applications see, as examples of an extensive literature, Gordon, Robert J., “The Demand for and the Supply of Inflation,” Journal of Law and Economics (06 1975): 807ndash;36Google Scholar, esp. 828; Maier, Charles S., “The Politics of Inflation in the Twentieth Century,” in The Political Economy of Inflation, ed. Hirsch, J. Fred and Goldthorpe, John H. (Cambridge, Mass.: Harvard University Press, 1979), 37–71Google Scholar, esp. 40; and Olson, Mancur, The Rise and Decline of Nations (New Haven: Yale University Press, 1982), 224ffGoogle Scholar . and passim.

2. This is examkined in Woolley, John T., Monetary Politics: The Federal Reserve and the Politics of Monetary Policy (New York: Cambridge University Press, 1984)CrossRefGoogle Scholar. See especially chapter 4 on the financial community and chapter 5 on professional economists, and the relationship of these groups to the federal Reserve System.

3. McConnell, Private Power, chap. 9; Lowi, The End of Liberalism, 115–22; and Ripley, Randal B. and Franklin, Grace A., Congress, the Bureaucracy, and Public Policy (Homewood, III.: Dorsey Press, 1976), chap. 6, esp. 128–32Google Scholar on Medicare.

4. Lowi, The End of Liberalism, 118; Lindblom, Charles, Politics and Markets (New York: Basic Books, 1977), 198–99Google Scholar; Montgomery, David, Workers' Control in America (New York: Cambridge University Press, 1980), 170–71Google Scholar; Tomlins, Christopher L., The State and the Unions (New York: Cambridge University Press, 1985), 317–18Google Scholar.

5. The history of American labor politics within changing international monetary regimes is the subject of any essay “Liberalism. Money, and the Situation of Organized Labor,” in Public Values and Private Power in American Politics, ed, Greenstone, J. David (Chicago: University of Chicago Press, 1982), 173–206Google Scholar . For the contemporary perary period, that essay concentrates on the administrative rather than the legilative aspects of umiongoverument relations.

6. Cf. Lowi, The End of Liberalism, 106: “Bitter political conflicts within the agricultural community have been fought over the margins, but on the system itself there is almost total consensus among the knowledgeable minority and total apathy and ignorance among the nonagricultural majority”.

7. The following account of agricultural legislation, including information on voting, is drawn from Congressional Quarterly Almanac 1–35 (1946–79). Also useful were Congress and the Nation, vols. 1–4 (Washington, D.C.: Congressional Quarterly, 1965–78).

8. In reviewing the passage of farm legislation, I have been interested in such activities as labor's endorsing, negotiating, and scheduling bills prior to the vote. When the Democratic party leadership took the more active role, and there was no noticeable labor support on the record, no argument is made of determinant labor influence. On the other hand, in analyzing voting on bills on which labor did actively lobby, there has been an equation of “labor” and northern urban Democrats. This latter procedure is consistent with other studies of Congress concerned with party and constituency interests. See, for example, Mayhew, David R.Party Loyalty among Congressmen (Cambridge, Mass.: Harvard University Press, 1966), 109ffCrossRefGoogle Scholar. On the geographical distribution of labor strength in Congress, see Pohlman, Marcus and Crisci, George S., “Support for Organized Labor in the House of Representatives, the 89th and 95th Congresses,” Political Science Quarterly 97, no. 4 (Winter 1982): 639–52CrossRefGoogle Scholar. The importance of organized labor to the electoral base of the Democratic party is well established by empirical research. On party identification see Petrocik, John R., Party Coalitions: Realignments and the Decline of the New Deal Party System (Chicago: University of Chicago Press, 1981), 67–69Google Scholar. On labor's financial support for Democratic congressional candidates, see Jacobson, Gary C., Money in Congressional Elections (New Haven: Yale University Press, 1981), 85–86Google Scholar. On labor's role in influencing industrial and urban district voting on agricultural policy, see Pennock, J. Roland, “Party and Constituency in Postwar Agricultural Price-Support Legislation,” Journal of Politics 18, no. 2 (05 1956): 167–210CrossRefGoogle Scholar, esp. 202–09; and Barton, Weldon V., “Coalition-Building in the U.S. House of Representatives: Agricultural Legislation in 1973,” inc Cases in Public Policymaking, ed. Anderson, James E. (New York: Praeger, 1976), 139–72Google Scholar.

9. Prior to 1949, congressional debate was over the extension of wartime legislation protecting basic crops and a long list of perishable or “Steagall” commodities (hogs, chickens, eggs, milk, soybeans, etc.) at 90 percent parity. Since 1945, organized labor, through its representatives on the Advisory Commission of the Office of War Mobilization and Reconversion, had been on record as favoring extending this legislation without amendment. Southern and western Democrats from cotton and livestock areas backed an end to controls.

10. For roll-call analysis showing urban Democratic support for farm legislation, 1949–64, see Mayhew, Party Loyalty, 46–56.

11. A different roll-cali analysis of this legislation, consistent with my argument, is in Barton, “Coalition-Building,” 158.

12. See Greenstone, J. David, Labor in American Politics (New York: Knopf, 1969), chaps. 7–8Google Scholar. Although he does not treat agricultural interests specifically, Greenstone rejects the idea that labor exerts “pluralist,” i.e., one-way, influence on the Democratic party. Our disagreement would be on the rationale, rather than the fact, of the labor-Democratic alliance.

13. Interviews by the author. Also see Cochrane, Willard W. and Ryan, Mary E., American Farm Policy, 1948–1973 (Minneapolis: University of Minnesota Press, 1976)Google Scholar, 86 and passim; Barton, “Coalition-Building”: and Sinclair, Barbara, Congressional Realignment, 1925–1978 (Austin: University of Texas Press, 1982), 139Google Scholar.

14. Orren, “Liberalism,” 184–86.

15. These include Benedict, Murray R., Can We Solve the Farm Problem? (New York: Twentieth Century Fund, 1955)Google Scholar; Higbee, Edward, Farms and Farmers in an Urban Age (New York: Twentieth Century Fund, 1962)Google Scholar; U.S. Congress, Senate, Committee on Agriculture and Forestry, Farm Program Benefits and Costs in Recent Years, by Walter W. Wilcox, 88th Cong., 2d sess., Oct. 6, 1964; and Schultz, Charles L., The Distribution of Farm Subsidies: Who Gels the Benefits? (Washington, D.C.: Brookings Institution, 1971)Google Scholar. For the same results into the 1970s, see Crandall, Robert W., “Paying for Government Policy through the Price Level,” Proceedings of the Academy of Political Science 33, no. 3 (1979): 42–56CrossRefGoogle Scholar, esp. 43–44.

16. Cited in Congressional Quarterly Weekly Report 17, no. 1 (January 9, 1959): 51. Also see Keyserling, Leon H., Agriculture and the Public Interest (Washington, D.C.: Conference on Economic Progress, 1965), 115Google Scholar. In the latter publication George Meany also appears on the list of conference members.

17. Christianson, Reo M., The Brannan Plan (Ann Arbor: University of Michigan Press, 1959), 72–74CrossRefGoogle Scholar.

18. For an instructive essay on the problem of studying intentionality in the social sciences see Ricoeur, Paul, “The Model of the Text: Meaningful Action Considered as a Text,” Social Research 38 (1971): 529–63Google Scholar.

19. That the change in operating procedures was triggered by foreign pressures is the position taken in Friedman, Milton, “Monetary Policy, Theory, and Practice,” Journal of Money, Credit, and Banking 13, no. 2 (02 1982): 91–118Google Scholar . The controversy over this question is discussed in Woolley, Monetary Politics, 139ff.

20. Gramlich, Edward M., “Monetary and Fiscal Policies,” in Inflation and National Survival, ed. Walton, Clarence C. (New York: Academy of Political Science, 1979), 132–46Google Scholar.

21. Appendix table A.2 gives a summary of data showing the marketable Treasury securities from 1947 through 1982, and actions the FOMC took to finance them. These figures by themselves are not a good indicator of monetary policy broadly speaking, be-cause any action taken must be seen within its specific economic context, against actions taken previously, and so forth. On the other hand, trends are apparent, and the change in magnitudes is suggestive of the degree that the FOMC has “monetized” the debt. Good accounts of the Federal Reserve System's goals, procedures, and actions over the period may be found in Tobin, James, National Economic Policy (New Haven: Yale University Press, 1966)Google Scholar, part 3; Bach, G. L., Making Monetary and Fiscal Policy (Washington, D.C: Brookings Institution, 1971)Google Scholar; Maisel, Sherman J., Managing the Dollar (New York: W.W. Norton, 1973)Google Scholar; Weintraub, Robert, “The Federal Reserve Money Supply Roller Coaster,” in The Political Economy of Policymaking, ed. Dooley, Michael P., Kaufman, Herbert M., Lombra, Raymond E. (Beverly Hills, Calif.: Sage, 1979)Google Scholar ; and Woolley, Monetary Politics. A useful volume on wage and collective bargaining developments during most of these years in Goodwin, Craufurd D., ed., Exhortation and Controls (Washington, D.C: Brookings Institution, 1974)Google Scholar.

22. Wage data are from Kosters, Marvin H., “Wage Standards and Interdependence in the Labor Market,” in Contemporary Economic Problems, 1978, ed. Fellner, William (Washington, D.C: American Enterprise Institute, 1979), 233–60Google Scholar. See table 4, p. 237.

23. The analysis here and in the following pages rests primarily on the Federal Open Market Committee Minutes, 1946–75. Citations are given only in the case of direct quotes or attributions. Consulted also were secondary sources listed in note 21 above.

24. U.S. Congress, House, Committee on Banking, Finance, and Urban Affairs, Quarterly Hearings on the Conduct of Monetary Policy, 95th Cong., 2d sess., July 28, 1978, 38. On Miller's position generally, see Joint Economic Committee, Hearings, 95th Cong., 2d sess., June 29, 1978, 91–95; and Subcommittee on International Economics, Joint Economic Committee, Hearings, 95th Cong., 2d sess., Dec. 14, 1978, 130–31.

25. Board of Governors of the Federal Reserve System, 65th Annual Report, 1978 (Washington, D.C., 1979), 133–34 and passim. For a contrary interpretation see Poole, William, “The Monetary Declaration: What Does It Mean and Why Is It Happening?” Brookings Papers on Economic Activity, 1979, no. 1, 231–40Google Scholar. Also see Kane, Edward J., “Politics and Fed Policymaking,” Journal of Monetary Economics 6, no. 2 (04 1980): 199–211CrossRefGoogle Scholar.

26. FOMC Minutes, August 23, 1955,467.

27. FOMC Minutes, March 27, 1956, 170.

28. FOMC Minutes, July 17, 1956, 378–79; and August 7, 1956, 455ff.

29. FOMC Minutes, May 28, 1956, 352.

30. Otto Eckstein, Tax Policy and Core Inflation, Study Prepared for the Use of the Joint Economic Committee, 96th Cong., 2d sess., April 10, 1980.

31. FOMC Minutes, October 12, 1965, 1113.

32. Again, these are industries in which at least 60 percent of employees were covered by a collective bargaining agreement. Industries that were between 10 and 59 percent unionized received an average 7.1 percent wage increase, and those under 10 percent unionized, 6.2 percent. Rosters, “Wage Standards.”

33. Cagan, Philip, Persistent Inflation (New York: Columbia University Press, 1979), 172Google Scholar. The year 1972 presents a good example of why the figures in appendix table A.2, taken by themselves, could be misleading. (See note 21 above.) Although what appears is a net decrease, the purchases of new debt at the end of the second quarter amounted to 49 percent of the marketable securities issued since the same quarter one year earlier. Also, given the heated state of the economy, and the net purchases in 1971, Fed actions for 1972 were expansionary.

34. FOMC Minutes, June 20, 1972, 624. The effects of fiscal stimulation on the 1972 GNP are reviewed in Blinder, Alan S., Economic Policy and the Great Stagflation (New York: Academic Press, 1979), 145Google Scholar and passim.

35. On this point, see Woolley, Monetary Politics, chap. 8. The thesis that Burns wanted to elect Nixon and shaped monetary policy accordingly—and that this is a formula normally followed in election years—is discussed in Tufte, Edward, Political Control of the Economy (Princeton: Princeton University Press, 1978), 45–55Google Scholar.

36. Meany is quoted in Newton, Maxwell, The Fed (New York: Times Books, 1983), 189Google Scholar. An evaluation of the Phase II wage control program is given in Weber, Arnold R. and Mitchell, Daniel J. B., The Pay Board's Progress (Washington, D.C.: Brookings Institution, 1978)Google Scholar, chap. 13.

37. On the various measures supported by labor to keep the Fed on an expansionary course see Orren, “Liberalism,” 196–97.

38. Burns, Arthur, Reflections of an Economic Policymaker: Speeches and Congressional Statements, 1960–78 (Washington, D.C.: American Enrerprise Institute, 1978)Google Scholar.

39. An interesting and concise treatment of these matters as they impinge on domestic economic policy is found in Calleo, David P., The Imperious Economy (Cambridge, Mass.: Harvard University Press, 1982)Google Scholar, esp. part 2.

40. On the Reagan administration's approach to farm politics and its effects, see Peters, John G., “The 1981 Farm Bill,” in Food Policy and Farm Programs, ed. Hadwiger, Don F. and Talbot, Ross B. (New York: Academy of Political Science, 1982), 157–73Google Scholar. Due to inflation, gyrations in the export market, and the strong dollar, supports have soared, amounting to over $60 billion between 1981 and 1985. This has severely strained the urban-rural coalition. See Stokes, Bruce, “A Divided Farm Lobby,” National Journal 17, no. 12 (03 1985): 632–38Google Scholar.

41. Hollingsworth, J. Rogers, “The Political-Structural Basis for Economic Performance,” Annals of the Academy of Political and Social Science 459 (01 1982): 28–45CrossRefGoogle Scholar, esp.

42. There was arguably less agreement on certain labor issues than on social policy: for example, construction and railway unions differed from the AFL-CIO unions on aspects of Taft-Hartley, common site picketing (until 1965), and pension and welfare plan re-forms. Also there is some question of whether trade and environmental legislation should be said to raise, from the perspective of dissenting unions affected, issues of social policy. It might also be mentioned here that the major dissident force in the labor movement at election time since the late 1950s, the Brotherhood of Teamsters, has not taken an active role in the legislation of social policy.

43. Labor's views on this range of policies may be found in the testimony of its leaders in U.S. Congress, Senate, Committee on Labor and Public Welfare, Manpower Problems of the Sixties, Hearings before the Subcommittee on Employment and Manpower, 86th Cong., 2d sess., 1960. See, for example, Walter Reuther, in part 1, 21 Off. Also see George Meany's statement in U.S. Congress, Senate, Committee on Labor and Public Welfare, Manpower Development and Training Legislation, 1970, Hearings before the Subcommittee on Employment, Manpower, and Poverty, 91st Cong., 1st and 2d sessions, 1969–70, part 1, 78ff; and Andrew Biemiller's letter to Chairman Nelson, pp. 71–73. Also see AFL-CIO, “National Economy, December, 1977” in National Commission for Manpower Policy, Labor's Views on Employment Policy, Special Report no. 25, July 1978.

44. On the changing percent, also known recently as the “natural rate” of unemployment, see Tobin, James, “Stabilization Policy, Ten Years After,” Brookings Papers on Economic Activity, 1980, no. 1, 19–78Google Scholar, esp. 58ff.

45. Perry, George L., “Slowing Down the Wage-Price Spiral: The Macroeconomic View,” Brookings Papers on Economic Activity, 1978, no. 2, 259–99Google Scholar, esp. 283. A review of the re-search on minimum wages is in Brown, Charles, Gilroy, Curtis, and Kohen, Andrew, “The Effect of the Minimum Wage on Employment and Unemployent,” Journal of Economic Literature 20, no. 2 (06 1982): [487–528Google Scholar; see, esp., 505.

46. On policies toward the unemployed and marginal worker, see Wachter, Michael L., “Unemployment Policies,” in Inflation and National Survival, ed. Walton, Clarence C. (New York: Academy of Political Science, 1979), 176–89Google Scholar.

47. Levy, Frank, “Changes in Employment Prospects for Black Males,” Brookings Papers on Economic Activity, 1980, no. 2, 513–38Google Scholar. See table 4. On the greater impact of minimum wageson black teenagers see Wachter, Michael L. and Kim, Choongsoo, “Time-Series Changes in Youth Joblessness,” in The Youth Labor Market Problem, ed. Freeman, Richard and Wise, David (Chicago: University of Chicago Press, 1982)Google Scholar.

48. The percentages are as follows: 1948–49, 6.9; 1950–54, 7.8; 1955–59, 13.2; 1960–64, 12.6; 1965–69, 12.5; 1970–74, 11.4; 1975–79. 12.2. After 1954, the lowest years are 1970 (8.9), when unemployment among whites went up from 3.1 percent to 4.5, an increase of 45 percent; and 1975 (9.0), when white unemployment went up from 5.0 to 7.8, or a 56 percent increase. Conversely, the black contribution is highest in 1966 (15.2) when unemployment among whites went down from 4.1 percent to 3.3, or a decline of 20 percent; and in 1978 (15.4) when white unemployment dropped from 8.2 percent to 7.2, a 16 percent decline. Calculations are based on data from the U.S. Department of Labor, Handbook of Labor Statistics (Washington, D.C.: Government Printing Office, 1980), table 29.

49. Orren, “Liberalism,” 182–88.

50. Charles Lindblom, Politics and Markets, chap. 13 and passim.

51. See, for example, Bowles, Samuel and Gintis, Herbert, “The Crisis of Liberal Democratic Capitalism: The Case of the United States,” Politics and Society 11, no. 1 (1982): 51–93CrossRefGoogle Scholar. A related though slightly different version is Przeworski, Adam and Wallerstein, Michael, “The Structure of Class Conflict in Democratic Capitalist Societies,” American Political Science Review 76, no. 2 (06 1982): 215–38CrossRefGoogle Scholar.

52. Lindblom, Politics and Markets.