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Labor in Wartime: Some Lessons from History
By David Montgomery 6 August 2006
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On September 11, 2001, some 3,000 people were killed as a result of murderous aerial attacks on the World Trade Center and the Pentagon. In the northeastern part of the country, thousands of working men and women of all races and many nationalities still suffer every day from the loss of loved ones, of jobs, and of their dreams for a better future as a result of those attacks. There were restaurant workers, computer operators, secretaries, maintenance workers, travel agents, investment counselors and bank clerks who lost their lives, along with the fire fighters who tried to rescue them. And next door to Ground Zero, in Chinatown, dozens of garment shops, restaurants, and businesses catering to tourists are closed to this day.
We are often told that September 11 changed everything in America. It certainly did change a lot in the personal lives of many of us and in the country’s political climate. Before that time most of us had regarded George W. Bush as president by virtue a one-vote majority on the Supreme Court, who quickly packed key positions in his administration with multi-millionaire C.E.O. veterans of earlier Bush and Reagan administrations. Since last September he has been riding high in the polls, and hardly a member of Congress will stand up and challenge any of the legislation proposed by those millionaire administrators.
But the closer we look, the more we see that has not changed. The economic crisis that has cost so many jobs in both manufacturing and service industries had already gathered plenty of steam months before the bombing attacks. Think about the legislative measures proposed by O’Neil, Ashcroft, Rumsfeld, and other millionaire cabinet officers: more and more tax favors to the very rich, privatization of government services, a huge arms budget and resurrected star wars, turning over our social security taxes and our retirement hopes to Wall Street stock brokers, removing all restraints on the powers of police and Immigration Service agents over the millions among us who are not citizens, fast-track approval for a new and badly misnamed Free Trade Agreement for all the Americas, gutting the enforcement powers of OSHA and the NLRB --- all these measures were on the administration’s agenda long before the airliners loaded with passengers and fuel were crashed into the World Trade Center and the Pentagon. The only thing that has disappeared from the administration’s agenda is the effort to ease the barriers against immigration from Mexico to the United States.
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The President and Congress have proclaimed a War against Terrorism. What does that mean to the struggles and hopes of working people ?
Our country went through a lot of wars in the last 100 years: two huge world wars, a bloody three-year war to suppress the Philippines’ independence struggle after 1900, marine occupation of Haiti, the Dominican Republic, and Nicaragua during the 1910s and 1920s, and then since 1945 there came Korea and Vietnam -- both long and bloody -- and also the swift assaults on Grenada, Panama, and Iraq -- to name only the best known. But the War on Terrorism is different. This time Congress gave the President war powers, but it did not even name the country we were going to war with. Bush publicly targeted any country which supports or shelters terrorists. And only one member of Congress (Barbara Lee of California) even raised a question about it. All alone Lee warned: “We are grieving. We need to step back and think about this thing so that it doesn’t spiral out of control.”
We wanted to protect our country against further attacks. But Bush used the strong patriotic response as a green light for a very different agenda. Most dangerous of all Rumsfeld, Cheyney, and company boast that we have displayed in Afghanistan an aerial power no one in the world could resist, and they now talk about turning the bombers against Iraq, North Korea, even Iran. Then who knows where else ? Columbia, Venezuela, Cuba, the Philippines again ? Back on September 20, on the first speech Bush made to the public after he came out of hiding, he said: “there are thousands of these terrorists in more than sixty countries....From this day forward, any nation that continues to harbor or support terrorism will be regarded by the United States as a hostile regime..” Bush concluded that the United States was entering “a lengthy campaign unlike any we have seen,” in which it would use “every necessary weapon of war.” That was his promise to Americans: an indefinite, even a permanent state of war.
What does a state of war without limits in time, space, or objectives mean for working people and their movement? The first thing to remember is that every war in this century has seriously undermined the civil liberties that are our country’s pride and joy. That was true whether our government’s objectives were clear and noble or hidden and rotten. Freedom of speech, freedom to organize, freedom from police surveillance can disappear quickly in wartime. They disappear quickly -- but it can take a long, time to win them back after the war itself is over.
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World War One, proclaimed as a war to make the world safe for democracy, was especially hard on democracy at home. Soon after Congress had declared war on Germany and Austria it enacted an Espionage Act. That law made it a crime to publish any reports that could be construed as aiding the enemy. It also passed a Trading with the Enemy Act, which gave the Post Office authority to censor the foreign language press and to bar from the mails anything that appeared to oppose the war effort. One of the papers banned from the mails in 1918 was the Minneapolis Socialist weekly New Times. Also in 1918 these laws were amended by the Sedition Act. It outlawed any negative remark about the government, the flag, or even military uniforms. In New York the editor of the Yiddish-language Daily Forward (soon to be banned) summed up the situation when he wrote:
“War ! The United States Attorney-General of free America has decreed: ‘Keep your mouth shut.’ And America shut up. Even my woman neighbor’s baby, which used to cry all night, is now quiet.”
The Justice Department then authorized a privately funded organization of 250,000 civilian volunteers, called the American Protective League, to ferret out disloyal words and deeds in every factory and neighborhood of America. Back in 1918 the Ford Motor Company joined the Protective program with such enthusiasm that it had more than 100 operatives supervised by three managers at the huge Highland Park plant, all assigned to spy on their work mates. Think carefully about these volunteer spies: President Bush indicated in his State of the Union Address that he wants to bring back a Citizens Corp of neighbor-watchers, as part of his “war on terrorism.”
The official historian of the American Protective League boasted at the end of the war that his league had kept America safe by instilling “fear of the silent and stern hand searching out in the dark and taking first one then another German or pro-German away...It was fear that held our enemy population down,” he wrote, “fear and nothing else.”
The Military Intelligence Division of the War Department initiated extensive surveillance and wiretaps throughout the country, focusing their attention especially on radical workers’ organizations, African-Americans, and the foreign born. The records of that division are now available in many university libraries and provide a splendid source of information for historians -- though you have to take the information provided by snoopers with plenty of salt. Police surveillance in the U.S. was stricter than anything found in France, where the war was actually being fought. More than 2,000 people were arrested under these laws, and 1,055 sentenced to jail. Most famous among them was the Socialist leader Eugene V. Debs, who stayed in jail until 1923.
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Repression was especially open and brutal in World War I because so many people opposed it. Keep in mind that 13 per cent of the United States’ population in 1917 had been born abroad. If we add Americans with foreign-born parents to that number, the number rises to 34 per cent of all residents in 1917-18. And by far the largest single group among them were then of German ancestry. The years between 1921 and 1965 were the only time in our history that immigration was reduced to a trickle. In our own times immigration is again a central feature of working people’s lives -- as everyone here knows. Once again today the proportion of our population born abroad is again approaching that of 1917 -- and once again immigrants are being treated by the Attorney-General as individuals who pose such a special danger to the country that the Bill of Rights and due process of law should not apply to them. That makes the experience of World War I important for us to remember today, even though it was a very different war from the one we now face.
We like to think that everyone then marched happily to the tune of “The Yanks Are Coming.” But in fact there was enormous opposition to the declaration of war in 1917, and in those days the news media reported different points of view. (Try to find that today !) Fifty members of the House of Representatives voted against the war declaration (including 4 of the 9 Congressmen from Minnesota), as did six Senators . Tens of millions of working people either had family in Germany or other enemy countries, or (unlike World War II) felt at least some sympathy for the German cause. The Socialist Party opposed the declaration of war, and it was then at the peak of its strength. It held the mayor’s office in Minneapolis. It campaigned vigorously to bring the carnage of the Western and Eastern Fronts to an end, and to resist the oppressive measures here at home. And it protested that working people were forced to pay the heavy price of the war. It demanded that the government “conscript wealth.” Jewish, Polish, Finish, and Ukrainian immigrants despised our new ally Tsarist Russia as their bitter oppressor. All up and down the Great Plains old-time Populists regarded the financiers of the British Empire as their main enemy. In Oklahoma white, black, and Creek Indian farmers took arms together and seized local court-houses in revolt against the draft.
Moreover, the spring and summer of 1917 saw the biggest strike wave in American history down to that time. Strikers shut down basic extractive industries like lumber, oil, and copper in the months after the U.S. had declared war. Five cities had general strikes in 1917 and early 1918: Springfield, Illinois; Waco, Texas; Billings, Montana; and Kansas City, Missouri. The fifth city was Minneapolis, which AFL unions shut down for half a day in sympathy with striking street car workers.
Federal authorities made special efforts to keep the strike movement and the anti-war movement from converging. They often arranged sympathetic hearings and concessions to unions, while they attacked revolutionaries and peace advocates ferociously. They knew very well that workers in France, England, Germany, Russia, and Italy were also staging large strikes by the middle of 1917, and that huge numbers of people in the cities and countryside of Europe had become convinced that the only way to end the misery of the war was through social revolution. To prevent similar developments in the U.S. the government rounded up 166 leaders of the Industrial Workers of the World, in the fall of 1917, tried them for sedition, and shipped them off to jail. Thirty-two states followed suit by enacting “criminal syndicalism” laws - making it a crime to strike for political purposes or to advocate “crime, sabotage, violence or other unlawful methods of terrorism.” Minnesota was one of the first to do so. Some of those statutes were used again during the 1930s , while scores of Wobblies imprisoned under their terms during the war stayed in jail for as much as 20 years.
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Many city and state governments vigorously joined into this repression. Minnesota managed to outdo all the rest. Its governor, J. A.. Burnquist warned that the population of his state was the most disloyal in the nation. At his urging the legislature created the Minnesota Committee of Public Safety. Its leadership and that of the new volunteer Home Guard quickly became virtually interchangeable with that of the Citizens Alliance -- the militant employers’ organization that smashed almost all unions in Minneapolis between 1903 and 1934. The Committee of Public Safety launched a campaign to stamp out support for the Socialist Party and the Nonpartisan League. Minneapolis had a Socialist mayor, Thomas Van Lear, but state authorities shut down meetings and newspapers that supported his reelection and drove Van Lear from office in 1918. In Bemidji they mobilized vigilante mobs to run all members of the IWW out of town. The Citizens’ Alliance also soon established its own employment bureau, to see to it that all manufacturers hired only workers who did not belong to unions. And it saturated the Iron Range, where the IWW had led a major strike the previous year, with spies and with copies of the Criminal Syndicalism law translated into Finnish, Croatian, Slovene, Bulgarian, and Italian.
Here is the main thing to remember: the end of the war did not end the repression it had unleashed all across America. Although the sections of the Espionage Act dealing with censorship by the Post Office were repealed in 1921, the rest of the law remained on the books and was upheld by the Supreme Court. Wiretapping telephone calls not only remained a common FBI practice, but was actually expanded during Prohibition in the name of fighting gangsters. Only after Prohibition was repealed did Congress in 1934 make it illegal for police to tap phone conversations, but six years later, war clouds loomed over the country again. At the Republican convention of 1940 Minnesota’s own Harold Stassen gave the keynote address. In words that would sound all too familiar to us today, he denounced the New Deal for hobbling industry “by bureaucratic interference and dreamy-eyed government delays at every turn while the army and navy plead in vain for the release of restrictions so they can speed up defense,” and he added that President Roosevelt had exposed the country to a “fifth column of traitors.” Congress passed the Smith Act, which was quickly used to imprison the Trotskyist leaders of the Teamsters here in the Twin Cities. And President Roosevelt himself authorized the Attorney General to listen in on activities of persons he suspected of being spies or subversives.
Not even the surrender of Germany and Japan could bring that surveillance to an halt. On the contrary, President Truman ruled that with the Cold War “domestic security” was in danger, he and unleashed wholesale FBI use of wiretaps on suspected activists ranging from Communists to Martin Luther King, Jr. Popular anger over police surveillance of civil rights struggles, while Ku Klux Klan bombers destroyed African-American churches and homes without fear of imprisonment, played a major role in inducing the Supreme Court to rule in 1967 (at last) that government taps constituted illegal search and seizure. But less that two years later Congress made bugs and wiretaps legal once again, in response to President Nixon’s campaign against crime and violence in our city’s streets. His attorney general (John Mitchell) authorized phone tapping surveillance by federal, state, or local police against anyone who agitated against the war in Vietnam.
Once again the Supreme Court stepped in. In 1972 the Court declared Mitchell’s wire taps illegal. By this time huge public protests against police surveillance had been unleashed by leaked news reports of the COINTELPRO program started by the FBI in 1967 to disrupt America’s left-wingers and black nationalists by provoking them into killing each other, and also by revelations that city Red Squads were tapping thousands of citizens and that government officials were using wiretaps for all sorts of personal reasons. Henry Kissinger even had taps placed on the phone of Nixon’s speech writer William Safire, and Nixon had his wayward brother Donald tapped. In 1984 some 3,000 citizens of my home town, New Haven, finally won compensation for illegal wiretapping by the police in the 1970s.
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But even then there was no secure and happy ending for the Bill of Rights. The 1990s saw a new wave of terrorist bombings -- some by foreigners, others American super-patriots: the World Trade Center in 1993, Oklahoma City in 1995, the Atlanta Olympics in 1996. President Bill Clinton asked Congress to restore police authority to bug and tap. Congress refused.
Then came September 11. Attorney General Ashcroft now had clear sailing for what he had always wanted. With one lone dissenting vote in the Senate (Russ Feingold ofWisconsin) and an overwhelming majority in the House Congress enacted the most sweeping authority in American history for police to search homes, scan computer use, bug phones, and also to detain suspects who are foreign citizens without trial or even charges indefinitely. The much-publicized Senate provision that these police powers will expire in 2005 actually applies to only a small portion of the act. An indefinite war against an unspecified enemy has brought with it authorization to an Attorney-General, famous for his contempt for civil liberties, to do whatever he wants for as long as he wants, as long as he can call it “fighting terrorism.”
To help you and me chart our course in response to these new threats, it is important to remember how hard it had always been to get back freedoms taken away in wartime. But it is just as important to remember how working people fought back, and shaped their own plans to improve American politics and society. Let’s take a few minutes to go back again to Minnesota and World War I. I have said that the state’s business leaders used wartime agencies and wartime public fears to drive home a fierce attack on working people. But right next door in North Dakota the Nonpartisan League won control of all the major governmental bodies between 1915 and 1920, and it instituted the most democratic state government this country has ever seen. Although the League declared its support of the war effort and sold Liberty Bonds, it also demanded “conscription of wealth” and made North Dakota a haven for persecuted peace advocates and socialists from other states. Its example inspired Minnesota’s farmers and workers to challenge the Citizens Alliance in primary elections (usually in Republican primaries, where most of the state’s farmers voted). They succeeded in many legislative races, despite the fact that League meetings were banned in 14 counties and its candidate for U.S. Senate (James A. Peterson) was sent to Leavenworth prison for sedition, as was the League’s national leader Arthur Townley. The progressive Republican former Congressman Charles A. Lindbergh (father of the aviator, but cut from a very different cloth) challenged Governor Burnquist in the Republican primary and got an impressive vote. But Lindbergh went down to defeat in the face of venomous hostility from the Twin Cities press. On primary election day 1918 the headlines of the Minneapolis Tribune read: “Vote in Minnesota the Way the Boys Shoot in France.”
The Nonpartisan League entered a full slate of state-wide candidates in the 1920 primary elections -- again most of them in the Republican primaries. Led by the moderately reformist farmers’ champion Henrick Shipstead, who filed for Governor, the League came close to victory in his battle for the Republican candidacy in a race that left hardly any one even bothering to take part in the Democratic primary. Two years later (in 1922) Shipstead was elected to the U.S. Senate on the slate of the new Farmer-Labor Party. For the next twenty years serious electoral battles in Minnesota would be those between Farmer-Labor and the Republicans.
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The new party had grown out of the Working People’s Nonpartisan Political League, formed by the State Federation of Labor at its 1919 convention with leaders like Susie Stageberg of Red Wing and St. Paul’s own William Mahoney. It worked in partnership with the farmer-based Nonpartisan League but pushed toward a new party -- a party dedicated to defending First Amendment freedoms and the workers’ right to organize, winning the eight-hour day, and public ownership of railroads, telephone service, packing houses, grain elevators, and natural resources. The Working People’s League declared that it wanted to end the control of domestic and foreign policy by “autocratic selfish private interests,” and to put government in the hands of those “who work by hand and brain.”
Farmer-Labor entered its own candidates in the state elections of November, 1922, and it drew about a quarter of the votes cast. The Minnesota party also aligned itself with the new national Farmer-Labor Party in the presidential elections. The national movement had its main base in the new party formed by the militant and creative Chicago Federation of Labor during its major organizing drives in steel and meat packing. The Chicago Federation underscored the link between struggles for democracy at home and those of workers in other lands by endorsing struggles of rank-and-file workers to control their industries in Europe and America, pledging support to the battles of people in Mexico, Ireland, and India to free themselves from the control of foreign capital, and demanding that workers’ representatives be sent to the upcoming peace congress in Paris, (and here I am quoting the Chicago platform) “pledged and organized to enforce the destruction of autocracy, militarism and economic imperialism throughout the world, and to bring about world-wide disarmament and open diplomacy, to the end that there should be no more kings and no more wars.”
The Citizens Alliance in Minnesota and business leaders around the country had a forceful and effective answer to these efforts by working people curb big business and strengthen democracy. Business organizations crusaded to “save our country from foreigners.” They charged that aliens were genetically incapable of appreciating America’s constitutional government and free enterprise. State and federal governments competed with each other to round up and deport subversive aliens during the postwar Red Scare. Although the public roundups largely disappeared after 1922, the number of individuals deported continued to rise quietly throughout the 1920s and reached a grand climax with the expulsion of 365,000 Mexicans between 1930 and 1933. Congress slammed the doors of immigration shut to all Asians and sharply limited immigration from Europe, heeding the advice of academic experts that “the preservation of national institutions depends principally upon the conservation of the race which builds them.” Several state legislatures outlawed teaching school classes in French, Italian, German, or Spanish -- let alone Japanese.
Millions of recent immigrants and their children were made aware every day that they lived not so much in America as under it. They joined in the long struggle to save the Italian anarchists Sacco and Vanzetti from execution, seeing them as personifying the abuse being heaped on the foreign born, and making their defense much more than just a radical cause or even only an Italian cause. As execution day approached in August , 1927, workers who had come from eastern and southern Europe, and often workers whose unions had long since been crushed, struck in protest from New York to Colorado. The great Slovene-American writer Louis Adamic left us this memory from his youth:
“In a lace mill near Scranton, Pennsylvania, where I worked for a while, I found the operatives, especially the men, in a bad mood. The management was speeding up the machines, forcing the employees to work faster and faster for the same pay, with the result that there was much sabotage on the machinery. Looms were injured; on the large machines leather bands were cut with safety-razor blades. The foremen blamed these things on ‘those Communist bastards.’ On several of the cut leather bands one morning ‘Sacco-Vanzetti’ was inscribed in white chalk.”
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It was these very same working people whose votes only five years later made the New Deal possible. Between 1924 and 1936 so many children of immigrants came of age and joined their parents in voting for the first time that the country’s voting population increased 57 per cent, and urban representatives gave Congress a very different character from that of the 1920s. Among the very first acts of the new administration and Congress they voted into office were emergency relief for the unemployed, the repeal of prohibition, and the granting of legal due process to men and women threatened with deportation. The number of immigrants deported fell in half within a single year. Once again, long years of struggle were lifting the burden of repression begun in time of war.
But there is one more important part of the historical struggles of working people in time of war. Every major war in the twentieth century brought with it vigorous growth in union membership, and an expansion of work-place militancy. After everything else I have said about repression, you may be surprised to hear me say that. But it is true, and we must think about what it means. Just as wars in the twentieth century brought suppression of democratic freedoms and fierce hostility toward the millions of people who had been born in other lands, so they also revitalized lagging economies and brought full employment. In both world wars the boom in armament production got under way a good two years before the United States declared war. When jobs were plentiful workers lost their fear of going on strike or being fired and blacklisted. Between 1916 and 1922 more workers went on strike every single year than had walked out in any previous year in the country’s history. In fact, a larger percentage of workers took part in strikes every one of those seven years than would ever be the case again, except for the huge strike wave of 1946, after World War II. Union membership grew rapidly, even in the face of such organized business power as the Citizens Alliances had used to beat down unions before the war in Minneapolis -- and in also in St. Louis, Indianapolis, Philadelphia, Cincinnati, New Haven, and all over the U.S. By 1920 more than five million dues-paying union members represented a much larger proportion of the workers in the private sector than belong to unions today.
Just as the federal government was determined to stamp out radical and anti-war sentiment, so it was also anxious to preserve industrial peace and keep production going. Its agencies during both world wars moved in quickly to settle disputes. In fact, workers learned that if they walked out, someone from Washington would be there by nightfall, trying to negotiate a settlement -- just as they did during the 1917 Twin Cities streetcar strike, despite the loud protests of the Citizens Alliance and the Public Safety Commission. Most noteworthy of all, the federal commission set up in 1917 to administer the country’s railroads instituted the eight-hour day, abolished piece work in repair shops, and helped union membership grow to some 90 per cent of the entire work force. Only the racist barriers of most railroad unions kept the level of organization on the railroads from reaching 100 per cent.
As soon as the war ended the railroads were returned to private hand, federal labor agencies were shut down, and business everywhere simply ignored pro-labor wartime decrees. By the summer of 1920 the war boom had given way to depression -- for a almost two years heavy unemployment stalked the land. Now the boss held the whip hand. Business unleashed an all-out attack against the labor movement, crushing unions in mass-production industries. The depression year 1922 witnessed some of the biggest strikes in the country’s history -- in coal, in textiles, in meat packing, and on the railroads. In every case workers fought under the worst conditions trying to save their earlier gains. In every case unions were beaten to a pulp, and the Open Shop era returned in the context of the crusade against foreigners . Now working without unions was given the glorious new name: The American Plan.
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World War II proved both similar and different. There is room here only to make a couple of points about it. First, some twelve years after 1922 working people picked up the union struggle where they had left off then -- but in a different political context. In massive battles, like that of Minneapolis in 1934, where workers and Citizens Alliances exchanged blow for blow, unions again secured a foothold in industry and transportation. In the Wagner Act of 1935 Congress declared the “policy of the United States” to be that of “encouraging the practice and procedure of collective bargaining and...protecting the exercise by workers of full freedom of association...for the purpose of negotiating the terms and conditions of their employment or other mutual aid or protection.” Listen to those words. Congress has never repealed them. Still the law of the land, they direct the federal government not to crush unions, or even to remain neutral, but to encourage and protect free association and collective bargaining.
When war orders boosted the economy, workers flocked into unions. Between 1940 and 1947 close to 85 per cent of the millions of workers given a chance to vote chose unions. Moreover, this time, because the U.S. had been attacked at Pearl Harbor, because our fascist enemies were committed to stamping out all traces of unions and democratic freedoms, and because revolutionary partizans of Europe and fighters against colonialism in Asia and Africa were fighting on our side, most working people were determined both to win the war and to use their new organized power to build a better future for themselves here and around the world.
Second, and most important of all, African-American workers all over the land mobilized the March on Washington Movement to demand equal access to jobs, the right to vote, and an end to segregation in the armed forces. Only days before the great march was scheduled to take place, in June, 1941, President Roosevelt announced the creation of the Fair Employment Practices Committee. For the first time since Reconstruction days after the Civil War, the federal government had declared its commitment to racial equality. In 1943 the CIO made equality on the job and in citizen’s rights a central feature of labor’s program. President Philip Murray called for “a down payment on the Four Freedoms,” starting with democracy in the American South.
So, what have we learned ? Back in 1917 the pacifist Randolph Bourne wrote: “War is the health of the state.” Have you noticed that Bush has stopped bellowing about “big government” ? The power of the government to shadow, police, and direct the everyday life and activities of working people have grown formidably every time our country has gone to war. Workers have won back democratic rights only partially and only over many long years of hard battles. Business and government leaders have rallied American citizens to beware of neighbors who were not born here -- saying those aliens do not and cannot appreciate our great way of life. The internment and expropriation of everyone of Japanese ancestry in 1942 provides the extreme case of the oppression that has resulted from such campaigns, but by no means the only one.
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But we have also seen that working people have stood together in battles to protect and even -- say in the case of the March on Washington Movement or the Farmer-Labor Party -- to expand democratic rights and participation during crises. At the very least they have rallied -- as they did with the demand to “conscript wealth” -- to prevent the whole war burden from being placed on the backs of working people, while the rich and powerful only magnified their own wealth and power. And we have seen that major wars provided the setting for dramatic expansion of labor organization -- only to face powerful conservative campaigns to roll back that expansion when the war economy was shut down.
Finally, everything I have said today should remind us that, for all the similarities to past wars, the unbounded and undefined “war on terrorism,” which has unfolded since September 11 is in important ways very different from anything that has come before.
First, our economy was on the skids and unemployment steadily rising for months before September 11, and the bombing attacks only speeded up the decline. Federal Reserve Board chairman Alan Greenspan has testified that even during the economic slump of the last three months of 2001, productivity per worker rose by 5.2%. Even if output and profits rise again, there is little prospect that the revival will create many jobs, despite soaring appropriations for military procurements and so-called missile defense. Economists now agree that business is unwilling to expand its investment in productive capacity here at home. In every contract negotiations we are faced with cuts in earnings and in health insurance, with subcontracting and privatization of jobs, with deeper cuts in state budgets, and with disappearing jobs. And the only remedy acceptable to the Bush administration is more deregulation and even more tax cuts for the wealthy and for corporations, which will dry up the resources available to states, let alone Congress, to offer any help.
More important -- and more fundamental -- is the whole shift in business strategy since the early 1970s. Corporations now routinely relocate operations around the world in an insatiable quest for cheaper labor. Right after World War II, when business and government integrated the new industrial unions into the economy and strategies of the Cold War, more than one-half of all the value added by manufacture in the entire world was produced within the United States. That was the material basis not only of the success of the industrial union movement, but also of the limited welfare state that the movement helped create. Think of how different the world economy had become by 1995. The World Bank then did a study which revealed that 78 per cent of the workers engaged in manufacturing in the whole world are employed not just outside of the United States, but outside of all the rich industrial powers of Western Europe, Japan, and North America.
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The shift of investment capital out of this country is the flip side of the resurgence of immigration, and even sweat shops, in the United States. As one recent immigrant put it neatly: “We are here because you are there.” Certainly any immigrant knows what that means.
And here is the final lesson of our times. Our government now proclaims that the best answer to any problem will be created by “market forces.” What we must remember is that markets are crafted by force -- and always have been. Government decrees and appropriations, the lending power of international capital, international treaties, and, in the last analysis, bombers, missiles, and helicopter gun ships not only provide international business operations with protection, but also shape their possibilities of expansion -- like the projected American oil pipeline from Kazakhstan through Afghanistan to the Indian Ocean. That was true before 1945, when the great industrial powers carved up the world between them into colonies and spheres of influence. It is true today, when the military might of the U.S. is used to make the entire globe safe for multinationals.
Washington tells us every day that the hope of the world lies in expanded free trade. But we are learning the hard way that NAFTA and the pending Free Trade Agreement of the Americas are not by any means just about shipping goods back and forth between different countries. Did you see Bill Moyers’ show back early in February about chapter 11 of NAFTA -- the stealth chapter of the treaty ? It defines regulations adopted by any government in our Hemisphere to protect environment, health, or labor in a way that might reduce a company’s profits as illegal taking of corporate property. It authorizes corporations to sue the government for millions in alleged loss of profits -- any government ! For example, when California order discontinuing of the use of PTBE, a gasoline additive that was getting into water supplies and causing cancer, the Canadian company that makes the additive sued the government of California for $970 million in compensation. The case is being tried in a secret, offshore special tribunal created by NAFTA. Corporations can now put their headquarters in tax-havens like Bermuda or the Cayman Islands, run production in Minnesota, Guatemala, and Brazil, and sue any the governments of any of those places in a NAFTA court for any loss of profits allegedly caused by the laws enacted by governments the people of those countries elected.
All these thoughts add up to three things. First, we must rededicate our labor movement as a social movement, directed to strengthening democracy in the workplace, government and social life, and turning them toward the people’s needs.
Second, we have sung, “Solidarity Forever,” but solidarity is now more important than ever -- solidarity among working people of all kinds, and solidarity across national boundaries. We are all in the same boat.
Third, as we confront the menace of terrorist attacks, we must listen to the wise voice of Congresswoman Lee: “We are grieving. We need to step back and think about this thing so that it doesn’t spiral out of control.”
David Montgomery presented this paper at the Meeting the Challenge conference in March 2002 at Macalester College in St. Paul, Minnesota.
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