But when our economic system is examined under the microscope, and when we turn the telescope upon the conflict between violent economic and social forces which is raging throughout the world today, it should become clear beyond all doubting that no such program of mere elimination will serve to reestablish the political economy of our pioneering parents as the economic order suitable for our machine-ridden, industrialized children.

Our ideals may well be individual freedom and social justice. But we will not achieve them, either by letting individuals exercise vast economic powers without social responsibility, or by creating a political organization to relieve us of individual responsibility for our own lives, which is the essence of personal liberty. In our constitutional democracy we have limited the power of society to control the individual and the power of the individual to control society. In impatience with these limitations, as they seem alternately to impede social progress or to restrain individual freedom, we swing from demands for more power in government to demands for less government. The statesman who would preserve democracy must be always seeking a middle road, a compromise that will restore a balance of power which has been temporarily lost.

We have not yet really tried to plan and to control in democratic fashion our competitive system. We have not yet really tried to regulate competition within industries and between industries by self-imposed restraints upon wasteful, cutthroat practices, enforced primarily by self-discipline and only secondarily by government.

Many people think we tried this program in the NRA and that it failed. The truth is that the NRA was an emergency effort: first, to revive stagnant business and relieve unemployment; second, to reorganize trade and industry overnight into a planless cooperation of competitors pledged to a free-for-all fight as soon as the rules of humane slaughter could be adopted and approved by Government umpires."

It is true that the underlying purpose of the Recovery Act was the gradual establishment of what has been called self-government in industry. It visualized the ultimate emergence of a cooperative program, under which a competitive system of private enterprise would be preserved as an orderly method of selfadvancement combined with public service, instead of as a ruthless, wholly selfish struggle for existence. But the NRA did not live long enough even to lay the foundations for such an economic structure. It did not live long enough to develop even a tentative program for a continuing and balanced increase of production and purchasing power that would steadily increase employment and give assurance of a recovery that would be sustained.

We cannot absorb an abundant production except through the enlarged buying power of a fully employed and adequately paid working population. We cannot end the crushing burden of widespread unemployment and discouraging taxes, except by stimulating the increased employment of capital and the expansion of private business.

We can spread work, but we cannot increase total purchasing power merely by shortening hours. We can raise and lower nominal wages and prices by inflationary and deflationary monetary policies; we can raise and lower the purchasing power of one class at the expense of another by special legislation and by organized coercion; but total purchasing power will not thereby be increased. We can only achieve an actual increase of total purchasing power through generating a well-balanced increase of exchangeable products throughout the Nation. The resulting larger volume of exchange will mean an actual increase in national income.

In the development of such a program through the carefully planned cooperation of management, labor, and Government, and in faithful service to its high purpose, lies the hope of preserving our heritage of free enterprise and selfgovernment.

It has been my present effort to analyze a problem-not to offer a simple solution. And the effort has been to analyze that problem with a dispassionate candor impossible to anyone who is emotionally convinced that there is only one sure road to one true goal and that he has found it. I do not believe that there is today any man or group of men, however highly educated or scientifically trained, with the ability to plot an absolute course to an assured destiny for any nation to follow through the political and economic difficulties of this era of great

17 See Richberg, op. cit., supra, note 6.

94422-49-pt. 2-20

change.18 The reactionary who claims to know exactly how to return to a world that has vanished, and the self-confident radical who claims to know exactly how to advance into a world that has not yet been created, are alike false guides. But we must move forward into the opportunities and responsibilities of a new world. We must be willing and prepared to go forward over roads in process of construction because forces beyond our control have been destroying the roads over which we have moved into the civilization of our day. And in this adventure I must confess one emotional bias, which is an underlying faith that democratic processes and the voluntary cooperation of freemen offer the best assurance that safe roads to a desirable goal will be found.

SIGNIFICANT DEVELOPMENTS IN LABOR LAW 1941-461

(By Donald R. Richberg 2)

A review of the significant developments in labor law in the last 5 years might begin with a catalog of statutory changes, Executive orders, administrative rulings, and judicial decisions. It might cover State and Federal law. It might then have some value as an index but even an adequate description of the items, without commentary, would consume considerable space. Evidently it is desirable to avoid producing a catalog and to select those developments which can be regarded as having large significance. In that selection, attention should be directed primarily to Federal law.

BACKGROUND OF FEDERAL LABOR LEGISLATION

It is Federal law that has wrought great changes in the size and potency of labor organizations. It has given the wage earners not only encouragement, but positive aid in the growth of labor unions to promote their interests by means of what was once termed "collective bargaining" but which can now be more accurately described as "collective coercion." The Federal Government has extended its intervention and control of labor relations over so large a field that State authority in this rgeard has been reduced to practical subserviency. Labor unions have been granted sweeping exemptions from legal restraints, and many special privileges, while at the same time drastic restraints upon both the coercive and the persuasive powers of employers have been written into Federal law. This legal favoritism has stimulated and made possible the growth of economic and political powers in labor organizations which seriously threaten the eventual destruction o fthe free competitive economy and the political balance of power essential to maintaining a democratic government.

The exemption of labor organizations from the restraints of the antitrust laws began with the Clayton Act of 1914 and was emphasized, to use a mild word, in the Norris-LaGuardia Act of 1932.4

The passage of the National Labor Relations Act in 19355 marked the beginning of active assistance by the Federal Government to all labor organizations combined with the severe restraints upon the ability of employers to oppose such organizations.

6

The fair Labor Standards Act of 1938 brought the Federal Government into the business of determining not only minimum wages and maximum hours, but also of regulating overtime wages, a legislative error of majestic size.

The Railway Labor Act of 1926, amended in 1934,' provided not only protec

18 For a vivid photographic portrayal of the rapid evolution of our industrial civilization, see Spencer, The Greatest Show on Earth (1938).

1 A lecture delivered March 25. 1946, at the George Washington University, as one of a series of public lectures on Significant Developments in the Law, 1941-46. These lectures were made possible by the generosity of Harryman Dorsey, captain, JAG, AUS, an alumnus of the George Washington University Law School. The lectures were held under the auspices of the faculty of the law school, the George Washington Law Association, and the Student Bar Association. Mr. Richberg made minor revisions in his lecture in prepara

tion for publication.-[Ed.]

2 Member of the bar of the District of Columbia and Illinois: formerly general counsel, National Recovery Administration; member firm. Davies, Richberg, Beebe, Busick & Richardson (Washington, D. C.) since December 1936.

3 38 Stat. 730 (1914), 15 UT. S. C. sec. 12. et seq. 447 Stat. 70 (17932), 29 U. S. C., sec. 101, et seq.

5 49 Stat. 449 (1935), 29 U. S. C.. sec. 151. et seq.

652 Stat. 1060 (1938), 29 U. S. C., sec. 201, et seq.

7 44 Stat. 577 (1926), 45 U. S. C., secs. 151-158, 160-162.

tions for the self-organization of railway employees, but also (as somewhat exceptional in Federal legislation) imposed responsibilities upon both employers and employees to make every reasonable effort to use peaceful means to settle their differences, and provided an adjustment machinery through which disputes could be settled by voluntary agreement or with Government aid.

NATIONAL WAR LABOR BOARD

The foregoing laws, with others of less importance, provide a background of Federal labor legislation against which the United States moved into the complex and extraordinary problems of World War II. To meet the obvious need for governmental intervention to avoid wartime stoppage of production, the National War Labor Board was created by Executive order, January 12, 1942,8 succeeding the National Defense Mediation Board created by Executive order, March 19, 1941. It would require a volume to review the work of this Board and the concurrent and often overlapping activities of other wartime agencies dealing with labor problems, including particularly those of the Economic Stabilization Director.

As a matter of personal opinion, I question whether any government tribunal should include, as did the War Labor Board, avowedly partisan representatives. In a voluntary arbitration or an adjustment board set up by agreement, there is a service which may be performed by partisan members. A public tribunal may call for the assistance of partisans, although in the main I agree with the pronouncement of the late Joseph B. Eastman that partisans have their place before but not on a tribunal. It does not seem to me that the War Labor Board demonstrated the desirability of a tripartite public tribunal. But this point is highly debatable. My conviction is that anyone holding public office should have his first allegiance to the public interest and not to a private interest.

The War Labor Board advanced the unionization of workers and definitely promoted the so-called closed shop by its union security or maintenance of membership program. It was certainly a significant development in labor law when a Government tribunal, instead of limiting itself to the determination of wages and working conditions undertook to promote the strength and authority of labor unions. The Board was doubtless moved in part by some of the same reasons that brought into the National Labor Relations Act and the Railway Labor Act, as amended, the provision for exclusive control of collective bargaining by the organization selected by a majority of the employees.

If collective bargaining is to be made compulsory, there is obviously some protection to the employer and to the employees in having only one duly authorized representation of the employees. There is also the familiar argument that if collective agreements are to be maintained, the labor organizations should have the power of discipline and control over the employees who must individually carry out the bargaining. However, there are serious weaknesses in the arguments that may be made in behalf of the closed shop which at least suggest the impropriety of any governmental aid in establishing or maintaining a closed shop. The closed shop and a closed union-that is, one not open to all would-be employees-means the denial to many persons of a right to work which seems to me in conflict with the most important constitutional guarantee of liberty. Even if union membership is open to all, it may be on terms which the Government should hardly endorse.

It was not a pretty spectacle during the war to find that men recruited to work for the Government, as in construction camps, or indirectly in working to turn out supplies for the armed forces, would only be permitted to work on paying initiation fees and otherwise supporting a private organization not under any Government control.

If the War Labor Board had adopted the policy of the corresponding board in World War I, and had insisted that the status quo should be maintained, with no campaigns against either an existing closed shop or an open shop, the questionable practice of herding men into private organizations under a practical Government compulsion would have been avoided. No one can tell to what extent the conscripted labor unionists of today will be loyal to their organizations. There is, however, ample ground for believing that the only sound form of labor organization is the voluntary association of men who are willing to work together and to sacrifice for their common interests.

Executive Order 9017, 7 Federal Register 237 (1912).
Executive Order 8716, 6 Federal Register 1532 (1941).

Prophecy is hazardous, but I would venture a guess that compulsory membership in labor organizations, brought about with the aid of Government, will have an inevitable reaction in favor of legislation in the future to limit the opportunities of labor organizations to monopolize employments.

WAR LABOR DISPUTES ACT

10

In reviewing the war period, some attention must be given to the passage and operation of the War Labor Disputes Act.1° It will be recalled that this act was passed as a result of strikes and threats of strikes which threatened to an alarming degree the successful prosecution of the war. It was a hasty and in many respects an unfortunate enactment. Nevertheless, it must be conceded that the necessity for some legislation was clearly apparent. This act, with all its weaknesses, did operate to put a little of the fear of the Federal Government into some of the labor organizations and their leaders who had begun to manifest a disloyalty to national interests which, evil enough in times of peace, become quite intolerable in a time of war.

The War Labor Disputes Act also helped to dispose of one false theory, which is that a strike vote taken in advance of a dispute will register correctly the desire or unwillingness of the employees to go on strike. Anyone familiar with labor organizations should know that a strike vote is commonly regarded simply as a warrant of authority to the officers to do everything they can to force a good bargain for the employees. If the men did not vote to strike, their officers would be stripped of their best weapon. So, with practical uniformity, a vote, even by secret ballot, will favor a strike.

It might be quite a different proposition, if at the end of negotiations or after public officials had made recommendations for settling a dispute, a vote were to be taken by secret ballot as to whether the employees would favor accepting an available settlement or actually going on strike. That would be a real strike vote. The War Labor Disputes Act also provided means for preventing the stoppage of essential production by authorizing the President to take possession of a plant or property threatened with a strike, and to operate it under the terms and conditions of employment in effect at the time of taking, unless or until the National War Labor Board ordered changes in wages or working conditions. Furthermore, the law made unlawful any strike against Government operation. It can hardly be assumed that any similar law would be enacted by the Congress to prevent or to end strikes in private business in time of peace. But the question still remains as to how stoppages of production in public utility services, or other services upon which the life of the community depends, are to be prevented. There will always be a proper objection to compelling men to work for private employers, even at wages and working conditions fixed by Government. course men should not be compelled individually to work. The War Labor Dis putes Act permitted an individual to stop work. But since concerted action is so essential to maintain equality of bargaining ability between a powerful employer and a large number of employees, there will always be a sound objection to a law forbidding a strike for a legitimate object which is conducted by lawful methods, and which is the only recourse left to the employees against submitting to unacceptable conditions.

Of

But this wartime act should give some support to legislation to establish a peace machinery through which labor disputes can be fairly settled and to require employers and employees to make use of such machinery before stopping production by the arbitrary act of one side or the other.

In the case of public utility services at least, it seems clear that, since the properties are devoted to public use and subject to public regulation as to rates and service, the law might well impose on workers accepting such employment the obligation, first, to attempt peaceful settlement of disputes; second, if unable to reach agreement to submit the issues to an impartial arbitration; and, third, to avoid any concerted withdrawal from employment.

This principle might also be extended to private businesses upon which communities are wholly dependent for the necessities of life, such as the production or transportation of food or fuel. Then, in order to meet the contention that it would be involuntary servitude to require employees to work for a private employer, there could be established temporarily a Government supervision or even, in case of a noncooperating employer, a temporary receivership to protect public interests. The public health and safety certainly justify the intervention

10 57 Stat. 163 (1943), 50 U. S. C. App. sec. 1501 et seq.

of public officials just as much as the private interests of investors which are now conserved by law.

In addition to the limited effect of a few Federal statutes and many Executive orders, there have been much more important developments of labor law in the recent rulings of courts and administrative commissions. Judicial decisions sustaining administrative commissions and otherwise expanding Federal labor law are too numerous for adequate review in this brief space. But a few have particular importance and comprehend in the doctrines enunciated by far the most significant developments of labor law in the last 5 years.

MONOPOLISTIC ASPECTS

12

It may be well to consider first the steady expansion of the exemption of labor organizations from the prohibitions of the Sherman law." Although the foundation of this exemption is written in the Clayton Act," the early decisions of the Supreme Court reduced the exemption to very small size. In such cases as Duplex Printing Press Co. v. Deering, and Bedford Cut Stone Co. v. Journeymen Stone Cutters' Ass'n," the Court held that the Clayton Act only exempted labor union activities which were directed against the employees' immediate employers. Thus, a secondary boycott was held still to be unlawful.

13

The Norris-LaGuardia Act 15 extended the definition of a "labor dispute" to cover a wide range of controversies relating to wages and working conditions "regardless of whether or not the disputants stand in the proximate relation of employer and employee." Since then the courts have held that, by its declaration of public policy and protection of workers from the injunctions and conspiracy charges because of normal union activities, the act definitely strengthened and enlarged the labor-union exemption under the Clayton Act from prosecutions under the Sherman law.

It may well be argued that the Norris-LaGuardia Act and the Clayton Act together do not justify the full exemption which has been written into recent opinions of the Supreme Court. In fact, the vigor of dissenting opinions in some of the cases indicates that either the majority or minority Justices were writing their social or economic predilections into their opinions. The first question that concerns us is, however, what is the present law laid down in the majority opinions? As a secondary question, we may consider how long will these opinions represent the law? Probably they will have a longer life than the unanimous opinion of the Court in the Schechter case; and perhaps they may be eventually changed by statute instead of by judicial somersault. But the student of government who hopes that a free economy will survive in the United States for at least another generation must realize that to insure such a survival the present law vesting labor unions with monopolistic controls of commerce must be changed. A fairly recent case, Allen Bradley Co. v. Local Union No. 3,16 brings into full flower the doctrines previously laid down in such cases as the Apex Hosiery case and the Hutcheson case.' It is a curious result that the opinion by Mr. Justice Black in Local Union No. 3, although holding that labor unions cannot conspire with business organizations to restrain trade, nevertheless affirms with apparent finality the right of labor unions to conspire within themselves and with other labor unions to restrain trade and, as the result of such conspiracies, to compel business managers to make agreements in restraint of trade.

17

18

* *

The opinion points out that there is no doubt that the actions of the electrical workers to establish a monopoly in the sale of electrical equipment in New York City would be in violation of the Sherman Act as a combination of businessmen because, to quote the Court: "* It intended to and did restrain trade and monopolize the supply of electrical equipment in the New York City area to the exclusion of equipment manufactured in and shipped in from other States, and did also control its price and discriminate between its would-be customers." the Court says: "Our problem in this case is therefore a very narrow one-do labor unions violate the Sherman Act when, in order to further their own interests

16 325 U S. 797, 65 Sup. Ct. 1533 (1945).

17 Apex Hosiery Co. v. Leader (310 U. S. 469, 60 Sup. Ct. 982, 84 L. ed. 1311 (1940)). 18 United States v. Hutcheson (312 U. S. 219, 61 Sup. Ct. 463, 85 L. ed. 788 (1941)).

So