LABOR’S GREATEST CHALLENGE

In an interview in 1958, R.G. Soderstrom was asked to name the greatest challenge he’d faced in his first years as president of the Illinois State Federation of Labor. His answer came without hesitation:

Well, I’d say that unemployment caused the greatest trouble that we were confronted with. In fact, I sincerely believe out of forty years of active work in the labor world that unemployment causes all of the economic trouble that we have. If we can keep our people employed, everything else seems to work out some way, in a fairly satisfactory way. But when folks are unemployed and home conditions worsen, then all are in a terrible state of mind. When there’s no income there, things are really bad. And that’s the thing that has caused the only real trouble that I’ve been confronted with during my entire forty years.[1]

It’s easy to understand why Reuben was so attuned to the dangers of mass unemployment. He assumed the ISFL presidency less than a year after the infamous “Black Tuesday” stock market collapse. The subsequent depression quickly wrought destruction wholly unlike its 1907 and 1921 predecessors. The failure of thousands of local banks, including the People’s Trust and Savings Bank in Streator, wiped out billions in value from the economy.[2] Industrial wages were slashed by a third, construction wages by half. Prices, meanwhile, fell by only 16%, pushing basic goods even farther out of reach.[3] Amid the chaos, unemployment soared. The number of those unable to find work quintupled between 1929 and 1931. By 1933, one out of every four laborers was idle.[4]

To Soderstrom, this mass unemployment was not just a tragedy; it was a violation of workers’ rights. Every laborer, he said, had a “right to work which must not be taken away,” a right just as sacrosanct as the guarantee of free speech or the free exercise of religion.[5] To think otherwise was a crime against not just humanity but common sense. “There should be a job for every wage earner who needs work,” Reuben maintained. “Every right-thinking person in either management or government will agree this fact is correct.”[6] It was an opinion echoed by the Universal Declaration on Human Rights, championed by Eleanor Roosevelt and ratified by the United Nations General Assembly in 1948, which proclaimed “Everyone has the right to work, to free choice of employment, to just and favorable conditions of work and to protection against unemployment.”[7]

Throughout the Great Depression and beyond, Reuben argued for and secured a number of measures to help ease the pain of joblessness, including unemployment insurance, retraining programs, and public relief. While the public dole and private charity could address the symptoms of unemployment, Soderstrom believed they failed to treat the underlying disease. Relying on these alone, he warned, was unhelpful and unhealthy for labor. “Wage earners would much prefer employment to unemployment checks, helpful as these benefits are,” he wrote. “Resentment is always seething underneath. The unemployed worker rightfully feels annoyed and frustrated.”[8]

Instead, Reuben advocated a simple yet profound idea—a shorter work week without reduction in pay. “The only sound method of dealing with unemployment,” he argued, “is to reduce the number of hours per day and the number of days per week in proportion to the increase in the number employed.”[9] A six-hour, five-day work week without wage cuts went to the very heart of the joblessness problem by spreading the work around. True, employers may initially pay more for labor up front, but their losses would soon be offset by increased purchasing power and consumer confidence. As Soderstrom explained, “The worker must earn enough money to make him a steady purchaser and consumer. Those who employ labor cannot continue and will not continue to produce without customers—without consumers—and six million people unemployed and deprived of their weekly pay check does not stimulate consumption.”[10]

Such a plan was fair as well as sound. For decades, industrial automation had allowed manufacturers to slash work hours while simultaneously increasing production. Yet the benefits from this culling had gone solely to the factory owners, allowing them to grow increasingly rich even as their practices eviscerated the American working class. The 30-hour work week, Soderstrom said, would return a portion of those gains to labor. “If Industry can produce in six hours per day more than it can sell,” he asked, “why work longer than a six hour period?”[11]

From his earliest days as ISFL president, Soderstrom fought relentlessly to guarantee that every laborer had the right to work. As he wrote in his very first presidential Labor Day address in 1931:

The labor movement is charged with a grave responsibility: To point out, speak out, and lead the way in the attempt to break down the depression and solve this vexing problem of unemployment is our immediate responsibility and a task that must be done. Shorter hours and the five day week will not come by accident. Only through the pressure of the worker’s movement can this step be made. There is no other solution for unemployment.[12]

Many modern benefits, including the weekend, minimum wage, overtime pay, unemployment insurance, and more are the direct result of this historic struggle. Too often taken for granted, these fundamental protections have saved and enriched the lives of countless workers, a fact Reuben repeatedly noted with pride. Still, he never stopped pushing for more, always repeating Samuel Gompers’s maxim that “As long as there is one person seeking work and unable to find it, the hours of labor are too long!”[13]

LABOR WARNS OF LOOMING DEPRESSION

While the severity of the Great Depression is not in doubt, its cause remains an issue of controversy. To this day, economists, historians, and policy makers fiercely argue over its origins, in part because belief about what started this depression influences the actions taken to prevent and end future ones. Ben Bernanke’s conviction that the Federal Reserve was to blame for the Great Depression, for example, spurred him to radically cut interest rates and increase liquidity as Federal Reserve Chairman during the Great Recession nearly 80 years later.[14]

Organized labor of the era, however, had a very different answer. Automation—or more specifically, the unfair distribution of its fruits—was to blame for the depression and the unemployment it caused. Production had outpaced consumption, largely because the gains made from technological innovation went almost entirely to the manufacturer, leaving workers without enough capital to buy the very goods they made. As Reuben said, “Unemployment is the child of modern devices."[15]

If automation was the cause of unemployment, the AFL maintained, then the answer was a shorter work week at the same pay. This way, workers could finally share in the benefits of automation while spreading the available work around. More money in the hands of more workers would spur consumer demand, eating away at surpluses and triggering a virtuous cycle that would pull the nation out of the depths of depression. Soon, the call for a universal five day, six hour work week without reduction in pay rang out from every union hall across the nation.

The idea that unemployment should be addressed by shortening work hours dates back at least to the founding of the American Federation of Labor, when Samuel Gompers declared that fighting for fewer hours would increase both the availability and value of labor.[16] The argument was largely a response to the Industrial Revolution, which had seen machines become an integral part of the world of work. While some laborers viewed industrialization with suspicion, the AFL largely believed automation could enrich the lives of everyone, worker and owner alike. The problem wasn’t industrialization itself, but the fact that its benefits were awarded to only one side; as Soderstrom explained in a 1932 address:

Is machinery a curse? Of course not, but it should be a blessing. So far labor is excluded from this blessing. Machinery makes for an ease of production that excludes three-fourths of the thousands who were formerly employed. It could, by cutting labor to six hours, prove a benefit.[17]

Reuben and his fellow labor leaders were keenly aware of the gross inequality this exclusion had created, and began warning of a pending economic catastrophe at a time when most industrialists were predicting uninterrupted prosperity. The nation’s ability to produce, they said, had outstripped the populace’s ability (if not appetite) to consume, creating an unprecedented contradiction. Ohio State Federation of Labor President John Frey called it a “new Industrial Revolution,” writing in 1927:

No nation in the world’s history has ever enjoyed the actual and potential wealth which the United States enjoys today. We have become the wealthiest nation of the world. Our vaults contain more gold than any other country. Our banks have more deposits. Since the Great War we have lent many billions of dollars to other countries…[Yet] half of the miners were idle last year because home consumption and export of coal was not sufficient to give steady employment. An army of men and women in many of the other industries were idle one-third or one-half of the time for the same reason. In the midst of what we are told is prosperity, hundreds of thousands of wage earners were dependent upon outside relief to maintain themselves. There was not sufficient work to keep them employed. Huge manufacturing establishments with millions of dollars invested in buildings and machinery were idle much of the time because there was no market for their product…The world has never witnessed such an extraordinary situation.[18]

Examples of this prosperity paradox could be seen everywhere, especially in America’s beloved automobile industry. From 1919 to 1926, General Motors had increased auto production from 391,738 to 835,902 while reducing its workforce by 2,000.[19] The following year, roughly 40,000 Detroit auto workers lost their jobs due in part to automation.[20] If industry wanted to stave off crisis, Frey cautioned, they needed to put more money in the pockets of their workers immediately:

The problem is not one of over-production…The mass of people can make use of much more than they use and consume today. The real problem is one of under-consumption, the inability of the mass of people to purchase in sufficient volume to keep our industries at full capacity…The purchasing power of their wages has not enabled them to buy back in equal proportion to what they have produced.[21]

These warnings went unheeded, and any evidence of the problems labor voiced was actively suppressed. When James Davis, Secretary of Labor under President Coolidge, publicly stated that the number of idle workers was 4,000,000, he was allegedly rebuked by the President and told to “revise” his numbers. His subsequent report in April 1928 placed the number at less than half his original estimate.[22] Long after the stock market crash of 1929, industrial and political leaders refused to acknowledge the severity of the problem. As late as March of 1930 President Hoover still insisted:

Unemployment amounting to distress is in the main centered in 12 States. The authorities in the remaining 36 States indicate that only normal seasonal unemployment exists or that any abnormal unemployment is rapidly vanishing…The amount of unemployment is considerably less than one-half and probably not more than one-third of the volume of unemployment at the same period in the cycle following the crash of 1907 or that of 1922…All the facts indicate that the worst effects of the crash on employment will have been passed during the next 30 to 60 days.[23]

By the end of 1930, however, even the President could no longer deny the truth. The country was entering a depression unlike any it had known before—exactly as labor predicted.

REUBEN FIGHTS FOR A SHORTER WEEK

Soderstrom faced a daunting challenge upon assuming the ISFL presidency in 1930. This was labor’s darkest hour; a record number of workers were idle, and those lucky enough to be employed lived with the grim knowledge that they could lose their jobs at any moment. True to form, Reuben took the issue of unemployment head on, making it the focus of his first Illinois Federation of Labor convention. Speaking directly to workers across the state in his first-ever presidential address, Soderstrom announced:

Unemployment at this time is in the minds and on the lips of all workers; newspapers and magazines have printed hundreds of columns on the subject matter of unemployment and the prevailing depression. For a time the public press tried to minimize the seriousness of unemployment, but all business has been affected by it, and they can no longer hide their heads in the sand but are admitting that a crisis exists. As this depression continues to drag, unemployment increases…

Hours of labor must be reduced in order that more people can be employed. And the wages of those employed must be sufficient to make them good, steady purchasers; employers cannot continue to produce without steady purchasers. I think the best brains and the finest men in the labor movement are needed at this time, and with proper cooperation, the proper organization and the proper convention action we will be able to overcome the crisis. I think the Illinois State Federation of Labor ought to stand for the five-day week and the six-hour day without reduction in wages, as the sound solution of the problem.[24]

Soderstrom then made good on his word by approving ISFL Resolution One, calling for a 30-hour week across all industries—an audacious start to his presidency. He didn’t stop there. For months on end, Reuben campaigned for the five-day, six-hour work week. He opened his 1932 Labor Day address with a direct appeal for the shorter work week, predicting:

Give labor a pre-depression wage, a five day week and a six hour day and the unemployment problem growing out of the existing business depression will be solved before another Labor Day comes floating down the stream of time. The six hour day and the five day week is the brilliant sun of hope, shining behind the darkest cloud America has ever known, and here and there the rays of that economic orb must soon penetrate the overshadowing industrial darkness. Labor Day this year will find those who come in contact directly with life and real labor, and who are not blind or trying to blind others with humbug theories and scientific terminology, openly advocating this common-sense shorter day solution to the economic depression reigning throughout the United States. Our country today is well able, because of modern equipment in its industries and agriculture, to not only support itself but to supply three other countries of its own size with the necessities of life and raw material. Is there any good reason why millions of people should starve in the midst of such unparalleled abundance? Give back to the wage earners and farmers their buying power! This is the recommendation of the American labor movement.[25]

At that year’s ISFL convention, Soderstrom took direct aim at those who called the AFL’s plan too extreme, ridiculing them for failing to comprehend the enormity of the crisis:

While I am comparatively a young man, I have a rather keen recollection of three major panics. Back in 1893 a crisis such as we are passing through now was referred to as a “panic.” In 1907 a similar condition arose but the name given to it had changed—it was called “hard times.” Today the language mechanics are calling the unemployment and suffering experienced by the people of our country a “depression.” The word brings to the imagination a lane or road with a low place in it that we should pass over soon, but we are beginning to realize that this is something more than a mere depression. We are beginning to understand that we are facing a deep economic problem that can be solved only by a fundamental reorganization of industry, that with all this machinery production reaches to undreamed-of heights. If we are ever again to enjoy what is known as prosperity, the hours of labor must be reduced in order that more people might be employed…

Sometimes I think that this whole economic structure, this whole economic system is on trial. Sometimes I think that this whole capitalistic system is on trial. If I were a Communist I would certainly rejoice…If I were a Socialist I think I would exclaim to the whole world, “I told you so!” But I am neither a Communist or a Socialist, but a trade unionist who prefers the present economic system if it can be made to work. I believe that it can be made to work, unless the overlords of capitalism are as blind and stupid and dumb as were the Bourbons of France when they disregarded every warning and the whole empire crashed around their ears and the mob set up a guillotine in the marketplace. What is the answer? The buying power of the farmers and the industrial workers must be vastly increased and the hours of labor must be sharply reduced.[26]

Even if the cowardly “overlords of capitalism” couldn’t be counted on in this battle, Soderstrom assured, America’s workers could be:

Labor officials are facing the future confident and unafraid..If labor leaders sense the thought dominating wage earners everywhere, it is safe to say that a new courage, born in the very depths of despair, is rapidly crystallizing. Figuratively speaking, labor—starving, staggering, bleeding, with its back to the wall from the force and abuse of poverty and depression—is now to about-face and fight to end unemployment. While food, clothing, and shelter may be rapidly diminishing, we are still fighters, we still represent the fighting spirit of America, we still have our ancient fangs and claws, and wage earners, both organized and unorganized, are looking to the labor movement to give the command to march forward…to take such action as will force, if necessary, through pressure of our economic organizations, every employer to establish a six hour day and a five day week to permanently end unemployment in this great commonwealth of Illinois.[27]

With these words, the young state federation president declared war on any and all who opposed the 30-hour week in Illinois. The next front in that war, however, would open not in Springfield, Illinois, but in Washington, DC.

BIRTH OF THE NIRA & FLSA

The 1932 election breathed new life into the labor movement. Franklin D. Roosevelt’s landslide victory, accompanied by sweeping Democratic gains in the U.S. House and Senate, was broadly viewed as a resounding endorsement of an activist government focused on new and innovative solutions to unemployment. At the top of the agenda was a new bill, put forward by Alabama Senator Hugo Black, which would outlaw the transportation of goods produced by any company that permitted its laborers to work more than 30 hours per week. The popular bill moved with alarming speed; introduced in December of 1932, it passed the senate on April 6, 1933 by a vote of 53 to 30. The AFL threw its full support behind the bill. President William Green testified before the House Labor Committee in its favor, giving the bill his “personal and official approval.”[28]

Not everyone was enamored with the legislation, however. President Roosevelt and Secretary of Labor Frances Perkins had serious reservations about the bill. They worried about the one-size-fits-all nature of the legislation. “We agreed there must be some understanding of the differences in industries,” Perkins later wrote. “Some industries require continuous operation; others do not; and some must work long hours at peak season. We felt that a government agency must be set up, empowered to grant variations under responsible controls.”[29] They also worried that the Supreme Court would find the act unconstitutional. Most important was the absence of any wage protection provisions. FDR was convinced that, without a legally defined minimum wage, the immediate effect of the bill would be dramatic and damaging pay cuts. In response, he sent Secretary Perkins before House Labor Committee to argue for amendments introducing a flexible scale and industry-specific minimum wages.

This brought the new administration into direct conflict with the AFL, which had long opposed legislative minimum wages in the belief that they eventually turned into maximum wages. Higher pay, they held, was best achieved through union negotiation, not government intervention. “We want a minimum wage established,” Samuel Gompers wrote in 1912, “But we want it established by the solidarity of the working men themselves through the economic forces of their trade unions, rather than by any legal enactment…We must not, we cannot depend upon legislative enactments to set wage standards.”[30] President Green echoed that sentiment in his testimony and in discussion with the White House, insisting that the best thing the government could do with respect to wages was to ensure workers’ rights to form and join unions properly empowered to bargain with employers.

As a result of these discussions, the 30-hour bill was replaced with the National Industrial Recovery Act (NIRA), which created industry-specific codes establishing maximum hours, minimum pay, and working conditions. At the heart of the NIRA, to address Green’s concerns, was Section 7a, a clause enshrining the right of employees to “organize and bargain collectively, through representatives of their own choosing.”[31] The subsequent Fair Labor Standards Act (FLSA), enacted in 1938 and still in force today, went even further by establishing a national minimum wage and 40-hour work week enforced in part through guaranteed overtime pay for most jobs. It also prohibited abusive child labor. FLSA amendments have since added protections against discrimination based on gender and age. To this day, the FLSA is the single greatest protection laborers have against overwork—an accomplishment which would not have been possible without the drive for a 30-hour week.

UNEMPLOYMENT INSURANCE

Another important victory Reuben and the AFL achieved in their fight against joblessness was the creation of a national unemployment insurance law. Initially, like most of labor’s leaders, Reuben preferred union-administered voluntary unemployment insurance plans over public options, and worried that a public relief program would interfere with union efforts to bargain privately with employers.[32] In 1931, the AFL even passed a resolution in opposition to government-sponsored unemployment insurance, writing that “such laws would be unsuited to our country.”[33] Victor Olander, Reuben’s close ally and secretary of both the ISFL and the AFL resolutions committee, had played an especially crucial role in the resolution’s passage. “I have been as outspoken against unemployment insurance as any man in the country,” he said at the ISFL convention the following year. “It is no secret that the report written at the [1931 AFL] Vancouver convention, which struck squarely at the whole question, was largely the product of my pen.”[34]

Eventually, however, even Olander had to admit that the AFL’s approach to unemployment relief was inadequate. Union unemployment plans covered less than 1% of the workforce at a time when over 11,000 workers were losing their jobs every single day.[35] By the summer of 1932, the AFL executive board had reversed course, publicly coming out in favor of mandatory, government-administered unemployment insurance.[36] When the AFL delegates met again in 1932, they passed a resolution in favor of advancing such a program by vote of 300 to 5.[37] Although supportive of a national plan, the subsequent AFL proposal put most of the burden for passing such measures squarely on the shoulders of state federation leaders like Reuben, concluding:

It would be desirable, if possible, to press for the enactment of one uniform measure for unemployment insurance applicable throughout the United States. But, due to the provisions and limitations of the United States Constitution as interpreted by the courts…it is practically impossible to enact constitutional federal legislation adequately providing unemployment insurance covering employees engaged in work in the different states. The American Federation of Labor, therefore, advocates the passage of unemployment insurance legislation in each separate state, and the supplementing of such state legislation by federal enactments.[38]

Soderstrom immediately got to work. Labeling unemployment relief “an item of paramount importance,” he drafted and sponsored an unemployment bill in January of 1933 based on a measure recommended by the Unemployment Insurance Commission of Ohio.[39] Predictably, the effort was immediately met by fierce opposition from the Industrial Manufacturers’ Association and its allies, who testified that “Most of the industries of Illinois now are operating in the red and any added burdens imposed upon them probably will necessitate locating in another state.”[40] For two legislative sessions, this argument—that any effort to establish state unemployment insurance would send what few jobs remained out of Illinois—hamstrung Reuben’s efforts.

That all changed with FDR’s passage of the Social Security Act in 1935. Under the innovative unemployment insurance provisions of this bill, all businesses across the nation would be taxed “in order to make the cost of such a social policy bear evenly on business over the whole country.”[41] That money would then be disbursed to the states to administer unemployment insurance as they saw fit. It was a brilliant plan that turned the IMA’s argument on its head; now businesses were encouraged to leave states without unemployment insurance laws, as they would face the same taxes without the benefit of local customers with additional money in their pockets.

Thus empowered, Soderstrom passed Illinois’s first unemployment insurance act in 1937. The law, which Reuben called “the finest unemployment insurance act in the United States,” provided up to 16 weeks of unemployment payments equaling one-half of their normal pay, up to $15 a week. Furthermore, the cost of the program was borne entirely by employers, with no taxes on employee pay.[42] It was an unmitigated success, and a huge triumph for labor in Illinois.

BEYOND THE GREAT DEPRESSION

Over the years, Reuben repeatedly introduced and passed legislation to increase the duration and amount of unemployment payments. In 1945, the ISFL increased unemployment insurance minimums from $7 in 7 weeks to $10 in 10 weeks, and extended the length of payments from 18 to 26 weeks—a general increase of 40%.[43] By 1961, he had raised benefits to as much as $59 per week for a family of five for up to 39 weeks.[44] Even then, however, Soderstrom still preferred the shorter week as the answer to joblessness—so much so that he dedicated his Labor Day address that year to a proposal taking all the funds currently spent on unemployment insurance and investing them in companies that adopted the 30-hour week instead:

Subsidizing industry in this way could lead to a shorter work day without a reduction in pay…The shorter day works. When hours were reduced from 60 to 48 it resulted in absorbing the unemployed people…The possibility of full employment, through a reduction in working hours and financed with revenue now being used to provide solvent checks for unemployed people, has an attractive appeal. The idea is worth exploring.[45]

Unfortunately, Soderstrom’s attempts to pass 30-hour legislation in Illinois did not fare as well as his insurance bills. His first attempt in 1933 never received a proper hearing due to political machinations, and his 1937 bill, although recommended by the Illinois Senate Industrial Affairs Committee, was unable to secure passage.

Yet Reuben never gave up the fight, continuing to assert throughout the Great Depression that “the six-hour day and the five-day week without reduction in pay, as advocated by the American Federation of Labor, is the remedy. Nothing short of that will do.”[46] Even after the depression and the war that followed, anytime there was an economic tightening or a rise in the unemployment rate, Soderstrom took to the podium and press to call for a 30-hour week.[47] He continually challenged the notion that the 8-hour day was fixed or that labor had no right to demand more, reminding workers that “a 40-hour work week is no more sacred than the 60-hour week or the 44-hour week.”[48] Through it all, he never wavered in his conviction that the shorter week was the best way to guaranteed employment. “Government can do anything,” he always asserted. “It should make things favorable for the people. It can and should help to wipe out unemployment by encouraging the establishment of a six-hour day without reduction in pay.”[49]

Ultimately, Soderstrom’s fight for the right to employment enriched the lives of workers throughout Illinois and the nation. Through it, labor had won a range of benefits and protections that would have been unthinkable at organized labor’s birth. As Reuben himself later said, “Out of our experience we have found the so-called wild ideas of today frequently become the practical realities of tomorrow.”[50] It is this sense of imagination and possibility that gives Reub’s call to arms, first delivered in his inaugural Labor Day message over eighty years ago, an optimism and urgency that still resonates today:

Through proper agitation, pressure, and organization we can overcome this unemployment crisis…Doubt, hesitation, cowardly inactivity must go. Courage, work, sacrifice, whatever is necessary to be done to bring order out of this industrial crisis must take its place. The onward and upward march called Progress that we have been striving for so long is about to begin and the Illinois Labor Movement should head the parade.

We want higher wages. The surest way to get them is to reduce the work day; demand a shorter week. It will bring the blessing of employment for all and larger pay. It is a simple remedy for what ails industry, and labor history proves that it actually works when all other remedies have failed. Let’s Go![51]

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