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How Are Radical Reforms Won? Lessons From the New Deal

The New Deal’s Wagner Act was the biggest concession ever given to U.S. labor. The dominant narrative is that we should thank FDR or Senator Robert Wagner for it. But a close examination shows that it was thanks to radical labor activists and a wave of labor unrest that workers won their rights.

Juan Cruz Ferre

May 24, 2019
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GM Workers celebrate their victory in the Flint sit-down strike.

The Green New Deal offers a vision for radical changes to our economy, including a massive public investment in infrastructure and a federal job guarantee. As the name implies, the magnitude of the policy proposal is comparable only to the radical economic and social policies of the New Deal, in the 1930s. How was this New Deal possible? Was it a product of savvy liberal politicians? Or a response to mass, working-class unrest that threatened to become revolutionary?

Faced with an extraordinarily dire economic situation in the wake of the Great Depression and pressured by an emboldened labor movement and growing social unrest, the FDR administration took equally extraordinary measures in an attempt to revitalize the economy and appease labor.

The first period of the New Deal was characterized by a broad and partially contradictory array of policies directed primarily at assisting failing capitalists and, to a lesser degree, as a response to workers’ unrest—particularly the miners. The 1933 National Industrial Recovery Act (NIRA) was a hodgepodge of regulations in partial conflict with each other, crafted at the size and measure of businesses’ whim. It was supposed to bring order to the economy and stimulate growth by lifting antitrust restrictions, fixing prices and wages and eliminating or reducing competition among firms, but it was a blatant failure. No one complained when, two years later, the Supreme Court struck it down.

One provision in the NIRA, section 7a, was especially designed to win the support of labor. It granted workers the right to organize in unions “and bargain collectively through representatives of their own choosing.” It formally protected workers trying to unionize at their workplace and banned company-run unions, but it was never enforced. The bill had no teeth and effectively went conspicuously unheard by companies and government officials alike. The field of class struggle was still a lawless terrain where scabs where fended off with bare knuckles and clubs, and bosses often resorted to illegal armed bands to try to rein workers back into the factory.

This first phase of the New Deal did not bring about economic recovery and proved ineffective in mediating labor conflict. Just a year after the NIRA was passed, in 1934, a major wave of strikes swept the country, with prominent confrontations in Minneapolis, San Francisco and Toledo—these “big three” episodes of labor insurgency in the 1934 were all led by socialists of different stripes in the Marxist tradition. But in 1935, something extraordinary happened: The National Labor Relations Act (NLRA), or Wagner Act, expanded workers’ rights, increasing protection for those seeking union recognition and enforcing collective bargaining. The NLRA was passed by Congress despite the opposition of major business organizations, which feared it would give too much power to the growing AFL. This was not an isolated bill. It was accompanied by a host of proactive public policies: These included massive public works projects (the Works Public Administration employed up to 3 million people in 1936) and the Social Security Act (SSA), which established the old-age pension system that still exists today.

The extraordinary development of events during these years raises the question of how these reforms came to pass, in particular with regard to the expansion of workers’ rights. Was it the goodwill of a bold Franklin D. Roosevelt? Was it the staunch insistence of liberal Sen. Robert Wagner? Did the realignment of political forces provide a unique window of opportunity for major reforms? Was it mostly a response to labor unrest and the threat of a major upheaval? A heated debate on this question took place among renowned scholars some 40 years ago. Let’s revisit it.

Skocpol Against Marxism

Writing for the journal Politics & Society in 1980, Theda Skocpol laid out an “institutionalist” interpretation of the New Deal, attempting to debunk different Marxist theories of the state. In Skocpol’s view, the traditional “pluralist” paradigm of political power, in which governmental decisions stem from the unbiased competition of different interest groups in society, cannot explain the transformations that took place in the United States in the 1930s. In other words, she writes off from the beginning the idea that the state represents the will of the majority. Skocpol then contended that Marxist theories of the state, while much more promising in terms of explanatory power, also fail to successfully explain the New Deal reforms. Their main shortcoming is that they all see class struggle as the main driving force of social change, whereas in her view the determining factor in the New Deal era was the transformation of U.S. political institutions, in particular the government and the Democratic Party, and the independent activity of prominent individuals in this setting.

Class Struggle or Enlightened Individuals?

In Skocpol’s view, the determinant factor for the passage of the NLRA was the unique political scenario opened by the Great Depression, a scenario in which Democrats won the elections after decades of Republican dominance (and later increased their seats in the midterm elections). This, combined with Wagner and his staff’s extraordinary experience and institutional capacity, allowed them to eke out a stunning win for labor in the form of the NLRA.

A critical realignment took place, indeed, during those years, one that allowed the Democratic Party to sweep the 1934 elections with FDR at its helm. It is worth remembering that in order to secure the support of Southern Democrats, the New Deal excluded from the NLRA and the SSA agricultural and domestic workers, occupations that were disproportionately held by Southern Blacks. This ensured that the Southern economic order, which rested on low-cost, segregated labor, would not be jeopardized.

When Skocpol emphasizes the autonomous action of individual politicians and downplays the role of labor unrest, she is disputing a Marxist theory of the state, in which class struggle plays a prominent role at forcing pro-working-class concessions from government. This theory was well expounded by Fred Block. In his 1977 essay “The Ruling Class Does Not Rule,” Block proposes that in order to understand how the capitalist state works, we need to think of state managers (politicians, technocrats, state bureaucrats) as a distinct actor in the relationship between capital, workers and the state.

In normal circumstances, state managers seek first and foremost their own continuity in government, through re-election or direct appointment. At the same time, their likelihood of being re-elected depends on a healthy economic growth: A burgeoning economy enables job creation and expands the government’s tax revenue to implement social programs. If unemployment is on the rise and businesses are closing, it is unlikely that those same politicians will be re-elected. And since economic activity is heavily affected by investment decisions by major corporations, businesspeople wield an outsized influence over government policies. State managers, then, are strongly compelled to generate or maintain a favorable business environment, yield to businesses’ demands and provide all kinds of subsidies and guarantees to protect capitalist profits. The concept of “business confidence” is therefore at the center of Block’s theoretical framework.

When social unrest and working-class pressure increases to such an extent that it threatens business profits, the health of the economy and, as a consequence, sometimes even the stability of the whole regime, state managers are ready to accommodate workers’ demands so far as they don’t substantially affect capitalist accumulation. In this perspective, there is only a limited margin for making concessions to the working class.

There are special circumstances, however, when capital’s leverage over government is weakened. One of them is during deep economic crises: The threat of disinvestment by big business is no longer an effective weapon—there is already very low investment. It is in these situations when, according to Block, government officials have more leeway to effect extraordinary transformations of social policies in favor of the working class, assuming these officials are under the unbearable pressure of mass mobilizations and unruly unions. Such a concession becomes a major win for the working class. At the same time, the outcome has the effect of legitimizing the state in the eyes of the working masses, granting rights to a new section of workers and incorporating them into the state through institutional channels, effectively containing what used to be a rebellious movement.

But Skocpol says this was not the case in the 1930s. She asserts that it was not so much the threat of organized labor that forced the hand of government to grant the NLRA, but rather the actions of government officials that protected and encouraged workers to unionize, go on strike and emerge from the New Deal on a much stronger footing.

Section 7a of the NIRA, she contends, was achieved not through disruption but “by political lobbying by the American Federation of Labor and by the legislative efforts of Senator Robert Wagner.” This is a strong claim, and, as we will see, one she cannot support empirically. It was Wagner and his staff’s perseverance and reform spirit that should be credited. In Skocpol’s framework, the electoral victory that swept Congress in favor of Democrats, and in particular the “independent initiatives by liberal politicians within the Democratic Party,” played a prominent role, whereas the sheer direct action of workers on strike had allegedly failed to accomplish a lasting change in capital-labor relations.

Goldfield Joins the Debate

Nine years after Skocpol’s article was published, political scientist Michael Goldfield wrote a powerful rebuttal. Goldfield turned the argument around. In his view, the New Deal legislation resulted from the interaction of a strong labor movement, radical currents organizing within it (notably, the Communist Party), liberal reformers with close ties to capital and state managers who acted to preserve the stability of the system of governance and to thereby stay in office. And although Wagner and his team had a strong influence on the specific content of the bill, the impetus for it to be enacted was provided by the wave of labor unrest and growing influence of radicalism in the labor movement–not the other way around.

The strongest point in Goldfield’s argument is the chronology of events. Skocpol argued that strikes had significantly subsided in 1935, when the Wagner Act was passed, and therefore they could not have been the reason why the law was passed. But just a year before, the U.S. saw “a strike epidemic” (in the words of contemporary commentators) like it had never seen before. The Trotskyist-led teamsters’ strike in Minneapolis, as well as the general strike in San Francisco and the Auto-Lite strike in Toledo, defied both the law and the repressive forces of the state, and it won–sending a clear message to workers fighting around the country.

So is it fair to assume that the political climate had changed so much in just a year, with no major defeats for labor in the interim? Goldfield points out that the historic wave of strikes of 1934 was, in 1935, still vivid in everyone’s minds: “The 1934 events hang like a veil over the NLRA hearings and floor debates not just in 1934 but through the spring of 1935.” Moreover, they were a centerpiece of Wagner’s own speech in Congress when he made the case for the NLRA.

And what about the spectacular increase in union membership after 1935? A mainstay of liberal narratives about the New Deal—and a linchpin in Skocpol’s thesis—is that the dramatic increase in union membership after 1935 was a direct consequence of Congress passing the NLRA. After all, unionization increased in 1937 from 4 million to 7 million workers, according to records of the Bureau of Labor Statistics. But the problem with this argument is that the Wagner Act was not upheld by the Supreme Court until April 1937. Before this, practically no employer recognized the NLRB as a mediator for labor conflicts, and the law went unenforced.

In December 1936 the sit-down strike in Flint, Michigan, broke out and afforded the UAW a landmark win, adding 100,000 workers in one swoop. The victory of the Flint strike had an enormous impact on the labor movement nationwide. In the aftermath of the Flint strike, Goldfield recounts, “General Motors, Chrysler, and Big Steel were unionized, along with hundreds of other companies. Within one month after the end of the Flint strike, 247 other sit-down strikes had taken place, involving almost 200 thousand workers. Union membership surged to over seven million by the end of the year; the dam had been broken with little help from the NLRB.”

To be sure, scholars including Goldfield agree that the passing of the NLRA in 1935 probably had a symbolic impact on workers and trade union militants, and encouraged further labor unrest even if it didn’t actually protect them. But the importance of workers’ unrest—led in many cases by members of the Communist Party or the Trotskyist SWP—looms much larger in historical perspective.

Furthermore, the wave of strikes are only the most prominent episodes of social unrest in the mid-1930s. Millions organized in the largest unemployed workers’ movement the United States has seen, many of them were African American. The Communist Party played a leading role in the movement of unemployed. Communist and Socialist rallies drew tens of thousands in New York, Chicago and other big cities. Frances Fox Piven recounts that after a confrontation between unemployed workers and the police outside Detroit in which four protesters were killed, their coffins were carried behind a red banner with Lenin’s portrait and to the sound of the Russian funeral march.

After spearheading one of the most preeminent labor struggles in Minneapolis, the Trotskyists were expelled from the unions. The Communists, who had much more deeply penetrated the labor movement, were also pushed out or forced underground a few years later by the Taft Hartley Act, with the collaboration of AFL and CIO officials. As is evident today, the elimination of the most radical elements from the ranks of the unions would have profound and lasting consequences for the U.S. labor movement.

It should be noted that not even the most decisive government intervention could bring the economic crisis to an end. A new phase of growth and capital accumulation only began with the extraordinary mobilization of resources for World War II, which turned empty factories into war production units, and the destruction and later reconstruction of Europe through the Marshall Plan.

The Lessons for Today

Skocpol tried to rebuke Goldfield’s rejoinder the following year, but her (and Finegold’s) critique was torn apart by Goldfield’s own response in the same volume. Since then, the thesis that autonomous reform politicians were to be credited for the pro-labor legislation in the New Deal has been left only for dubious anti-Marxist scholarship and to uninformed, commonsense liberals.

The lessons of the New Deal couldn’t be more clear: It took a mighty working-class mobilization—including disruptions and illegal actions—and the effective threat of a growing anti-capitalist movement to obtain the concessions for labor embodied in the Wagner Act.

Furthermore, the NLRA contributed to co-opting the labor movement from the moment it was enacted. The NLRA shifted the logic of union organizing from one in which workers were forced to act in militant, solidaristic ways—generally by organizing an overwhelming majority of the workforce, and then conducting a prolonged strike. If the strike led to victory and the union was recognized by the bosses, there was no legal compulsion to continue recognizing the union. As a result, unions were forced to constantly maintain worker solidarity. After the passage of the NLRA, unionization was predicated on a vote of 50% plus one of the workforce, with the bosses legally compelled to recognize this result. The explosive, unruly nature of workers’ direct action gave way to an institutionalized process of representation, grievance procedures and mutual responsibility.

Today, after decades of working-class retreat, the NLRA barely protects workers’ unionizing drives, and the right to strike is ridiculously restricted. A fight to win back the rights that were taken away from us is the order of the day. Curiously enough, the main talk around the New Deal today is no longer related to recovering labor rights, but about avoiding a climate disaster. Yet the Green New Deal sponsored by Alexandria Ocasio-Cortez and Bernie Sanders includes not only extraordinary investments in renewable energy and other infrastructure requirements, but also a federal jobs’ guarantee and several proposals granting more rights to workers: from health insurance to medical leave and paid vacations.

Although it has been written off as pie in the sky or as an incoherent assemblage of environmental policy proposals and glimpses of a labor relations reform, the bill can be understood as a declaration of principles. Its purpose was, ostensibly, to shift the political agenda and radically change the conversation on renewable energy, massive government programs and workers’ rights.

READ MORE: A Green New Deal Can’t Save Us. A Planned Economy Can

But even if AOC and Sanders (and now many other Democrats) push hard for these proposals, none of them will be delivered unless there is sweeping labor unrest and a credible threat to the system itself. Socialists and revolutionaries will play the lead role. The increasing number of strikes seems to be pointing to a new wave of labor unrest. The many decades of capitalist offensive with little or no response from organized labor have reduced workers’ rights to bare bones. Deprived of a public health care option and lacking childcare or paid sick leave, American workers are subordinated to market forces to the extreme: Imagine a cliff and a multitude being pushed by a behemoth, which is capital. It is no wonder that workers are standing up now. The level of contradictions in U.S. society has reached such a high level that the explosion this time will be big. Socialists of all stripes will play a leading role in it, and the political decisions we make today will shape our prospects for years to come.

The lessons from the New Deal are that environmental activists pushing for a Green New Deal and, in particular, labor organizers fighting for some sort of new workers’ bill of rights can’t rely on smart politicians. Only an independent workers’ mass movement will be able to force these kinds of concessions from the ruling class. The owners of capital won’t sacrifice a cent of their profits until they face the economic disruption that mass workers’ collective action can cause, and until they are legitimately scared of the threat of a working class that rises and reclaims what is theirs: the goods, the riches, the world.

The author would like to thank Cody Melcher for his helpful feedback on an earlier draft of this article.

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