The Wagner Act


The Wagner Act was passed and signed into law by President Roosevelt in 1935, in the middle of the Great Depression. Also known as the National Labor Relations Act, it established collective bargaining as a remedy to the violent conflict going on between labor unions and employers. This is from the website Digital History:

Bitter labor-management warfare erupted as the Depression dragged on. In 1934, some 1.5 million workers went on strike. Auto and steel workers and longshoremen became involved in violent strikes. Police shot 67 striking Teamsters in Minneapolis. In August, textile workers staged the largest strike the country had ever seen--a total of 500,000 workers in 20 states. In Massachusetts alone, 110,000 workers went on strike, and 60,000 workers in Georgia struck. While some of the strikes aimed at higher wages, a third demanded union recognition. (Mintz, S. (2007). The Wagner Act. Digital History. Retrieved 1/17/2008.)

An investigation by a Senate committee headed by Senator Robert M. La Follette of Wisconsin revealed that corporations were conducting an all-out war to keep unions from gaining power. Agencies specializing in industrial espionage were hired to infiltrate unions and sabotage efforts to organize, and some corporations accumulated weapons in anticipation of outright battles with unions:

The Youngstown Sheet and Tube Company had on hand eight machine guns, 369 rifles, 190 shotguns, and 450 revolvers, with 6,000 rounds of ball ammunition and 3,950 of shot ammunition, and also 109 gas guns with over 3,000 rounds of gas ammunition.  (Labor in America: A History by Melvyn Dubofsky and Foster Rhea Dulles, 2004, Harlan Davidson, Inc. pages 262-263)

Congress not only wanted to stop the violence and disruption of commerce, but improve workers' wages and working conditions. This is from the Act itself:

The inequality of bargaining power between employees . . . and employers . . . substantially burdens and affects the flow of commerce, and tends to aggravate recurrent business depressions, by depressing wage rates and the purchasing power of wage earners in industry and by preventing the stabilization of competitive wage rates and working conditions within and between industries.

As written, however, the Act had no teeth. It forbade employers from interfering with employees’ efforts to form a union and forced them to “bargain” with the union. It did not, however, require the establishment of a contract and it did not condone violence or coercion from either party. Strikes were permitted, but strikers could not prevent employers from hiring replacement workers. This is from A Primer on American Labor Law by former chairman of the NLRB William B. Gould IV (page 106):

[E]ver since its 1938 decision in NLRB v. Mackay Radio & Telegraph Company the Supreme Court has held that, although striking is protected conduct, employers may permanently replace striking employees with strikebreakers. In other words, even though an employer may not discharge or discipline workers for engaging in a strike, the employer, in order to keep production going and the plant open, has a business justification for permanently ousting strikers through the recruitment of strikebreakers, and thus may just as effectively deprive employees of their job security as would be the case if they were dismissed or disciplined for striking.

The fact that violence on the part of strikers was not condoned by the Act was emphasized by the Taft-Hartley Act of 1947. Here is Gould again (page 55):

The Taft-Hartley amendments [to the Wagner Act] have imposed unfair labor practices restrictions on unions as well as employers. [T]he union may not “restrain and coerce” employees. Therefore a union may not lawfully engage in violence, disorder, or mass picketing that interferes with the movement of employees or the public into and out of the employer’s property or premises.

So it is unclear why Congress and President Roosevelt thought collective bargaining would improve the lot of workers. The employer had no reason to make concessions when he could get all the workers he needed at the current wage, and there was nothing in the Act to force him to do so. The expectation that friendly, face-to-face discussion would result in compromise was unrealistic, if not naïve.

As the years passed and employers reluctantly accepted collective bargaining as the law of the land, violence against unions subsided, but conflict continued  - even during the war years:

The number of labor disputes in 1941 reached a higher total than in any previous year, with the single exception of 1937. There were strikes in the automobile industry, in the shipyards, in transportation, in the building trades, in textiles, and in steel and coal mining. Hardly an industry escaped work stoppages, which for a time seriously interfered with production. In all, there were 4,288 strikes involving over 2,000,000 workers . . .23,000,000 man-days of work were lost. (Dubofsky, page 307)

Conflict continued because unions realized that they didn't have to take "No" for an answer. They found that the Taft-Hartley prohibition against violence was weakly enforced. They found ways to push the limits of the law, to intimidate without blatantly breaking the law. They cleverly came up with the name "scab" to vilify workers willing to take their jobs at lower wage than they were demanding and they portrayed themselves to the public and to politicians as the poor, trod-upon victims of cold corporate giants. With their numerical strength and reputation for violence, they scared the hell out of not only replacement workers, but local law enforcement agencies.

Conflict continues to the present. Here are some of the more notable strikes that have occurred:

  • On May 1, 1949 in Hawaii, 2,000 members of the International Longshoremen’s and Warehousemen’s Union (ILWU) walked off their jobs over a pay dispute. The strike, which lasted 178 days, came as the state was recovering from a 1946 statewide strike by plantation workers.

  • On 12/6/1954 in Pittsburgh, 760 delivery-truck drivers and helpers belonging to the Teamsters agreed to end their walkout against five of the city's biggest department stores (Kaufmann's, Home's, Frank & Seder's, Gimbels, Rosenbaum's) after 52 weeks of picketing and violence.

  • The UAW strike against GM in 1970 lasted 67 days. It cost GM $1 billion in profits, the workers $765 million in wages, the federal government $1 billion in taxes – plus $30 million in state welfare benefits and some $375 million in retail sales in Michigan alone. (The Automobile Age, page 280)

  • Another Hawaii strike, the great West Coast dock strike of 1971 will be remembered by local residents as the year that toilet paper rolls went empty. The strike began on July 1, when 15,000 dock workers in 24 ports on the West Coast walked off their jobs. The work stoppage spanned 134 days. Store shelves slowly went bare, businesses crumbled and people lost their jobs. But one of the rarest commodities at that time was toilet paper because residents hoarded rolls as supplies began to dwindle.

  • The baseball strike of 1994 was the longest and costliest work stoppage in the history of professional sports. Many view the strike as a huge waste of time, since no real modifications were put into effect. It lasted 234 days, resulted in more than $1 billion in losses, and deprived the nation of a World Series.

  • Strikes in 1998 by 9,200 workers in Flint, Michigan forced G.M. to shut down almost all of its North American production and temporarily lay off 192,000 workers, while its outside suppliers laid off thousands. Wall Street analysts estimated G.M.'s after-tax losses at more than $2 billion.

  • The 2007–2008 Writers Guild of America strike, more commonly known as the Writers' Strike, started on November 5, 2007 and concluded on February 12, 2008. It cost the economy of Los Angeles an estimated $1.5 billion.

  • A 53-day strike against Boeing by 27,000 members of the the Machinist union in 2008 cost more than $2 billion.

  • In November 2012, 800 harbor clerks walked off the job at the ports of Los Angeles and Long Beach, and about 10,000 longshoremen refused to cross their picket lines. The strike lasted 8 days, taking an estimated $8 billion out of the region's economy.

Although the Wagner Act did not stop conflict, it did increase wages and benefits of union members (an ever dwindling number of union members in the private sector). This came at the expense of the rest of society, however. The major accomplishment of the Wagner Act was to make possible a steady stream of income for union treasuries, because when a union is voted in, the employer is required to deduct union dues from the paychecks of the employees - dues that would be difficult to collect if the union had to do it by itself. For big unions, dues could bring in millions of dollars, which was what made organized labor attractive to organized crime. Dues paid for nice salaries for union leaders and enabled unions to make generous contributions to politicians who in return vote as the unions wish. Collective bargaining has corrupted the Democratic party, crippling its mission as advocate for the common citizen.

So if collective bargaining is not the solution to conflict between labor and business, what is?

The Alternative. By passing the Wagner Act, Congress legitimized and institutionalized hostile confrontation in labor relations, an area of commerce that – like others – should be entirely peaceful and free from conflict. No law requires “bargaining” for commercial transactions other than labor contracts, and yet there is no violence and turmoil in those areas. Food processors are not required to bargain with farmers. Walmart is not required to bargain with suppliers. Grocers are not required to bargain with shoppers. These parties choose or choose not to do business with each other - no hard feelings. Neither is forced to accept terms it feels are unfair.

Instead of requiring employers to bargain with unions, we should simply make it clear that although workers may form unions, employers are not required to bargain with them or collect dues for them, and although workers may strike, they may be fired for doing so. They may not interfere when the employer attempts to hire workers to replace them and may not harass the employer or his employees or his customers.  At the same time, employers should be prohibited from interfering with the workers’ right to discuss wages and working conditions and to form unions.

Strikes occurred before and after the Wagner Act became law and likely will continue even if collective bargaining rights are taken away. We must, however, make it clear to workers that it is the law of the land and the will of the people that they not interfere with employers’ right to set the terms of employment. To state it plainly, workers have the right to take or leave it, and if they insist on violent obstruction of an employer’s right to do business, they will be arrested and prosecuted.

Responsibility for protecting businesses from strikers will fall entirely on public law enforcement agencies. Businesses will be allowed to use force only in self defense, when the police fail to act.

There are those who would argue that the right to bargain collectively is a basic human right. But there is no such thing. In a democracy, rights are defined by the people. The right to form a union appears to be guaranteed by the first amendment to the U.S. Constitution:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.

Note that it says “peaceably”. While workers may have the right to form a union, the Constitution does not grant a right to block an employer from hiring replacements for striking workers, and the Constitution makes no mention of collective bargaining or a fair wage. With no right to collective bargaining and no official tolerance of workplace violence, unions will have no power. Other than as social and mutual benefit organizations, they will have no purpose.

Although collective bargaining is mentioned neither in the Bible nor the U.S. Constitution, it is considered by people all over the world as a basic human right, so if that right is denied in the U.S., the outcry will be deafening. This is a democracy, however, and if the people of the U.S. decide they don't want collective bargaining, that decision must be accepted by unions and their supporters. To fear the consequences of repealing the Wagner Act reveals that unions are too powerful, at least in the minds of the public.


Unions are Killing Michigan
The Wagner Act
What Economists Think
Why the Market Wage is Better
The Illogic of Collective Bargaining
Market Wage vs. Fair Wage
Imagining a Free Labor Market
Rights and Freedom
Destruction of the Middle Class
Employee Free Choice Act (EFCA)
Job Security
Collective Bargaining and Unemployment
Social Costs of Collective Bargaining
Ending Fringe Benefits
Democrats and Unions
Collective Bargaining in Government