The Rockefeller fortune was based primarily in five of the oil companies created in 1911 out of the original Standard Oil, after it was broken up by antitrust action. In the 1920s and 1930s, the Rockefellers held the largest blocks of stock in these companies and had great influence on their management. Four of the five companies were in the top 11 corporations in terms of their assets in 1933. Standard Oil of New Jersey (renamed Exxon in the early 1970s) was the second-largest corporation, and Standard Oil of New York (renamed Mobil at one point and then merged with Exxon in 1999 to create Exxon Mobil), was the fourth-largest. Then there was Standard Oil of Indiana at No. 6, and Standard Oil of California at No. 11 (Burch 1981, p. 14). Standard Oil of New Jersey was by far the most important and politically involved of these companies. Rockefeller had his offices in its headquarters building and was close to the senior management throughout the 1920s and 1930s, especially the president during these years, Walter C. Teagle. A grandson of one of John D. Rockefeller, Sr.'s, original partners, Teagle worked as an executive for various Standard Oil companies for 15 years before heading Standard Oil of New Jersey from late 1917 until his retirement in 1937. By the 1930s he was a director of White Motors in Cleveland and Coca Cola in Atlanta due to personal friendships with their CEOs. He served on the Petroleum War Service Board in World War I and chaired a Share-the-Work campaign for Hoover in 1932, making dozens of speeches across the country (Wall and Gibb 1974, Chapter 15). If the close and mutually respectful relationship between Teagle and Rockefeller can be kept in mind, and if Teagle's independent judgment is appreciated, then the idea of "Rockefeller" power in labor relations can be considered within a more open mind, especially after other dramatis personae are added to the picture.
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Then the political equation suddenly changed on April 6, 1933 when the Senate unexpectedly approved a liberal bill concerning wages and hours that would cut the workweek to 30 hours for the same daily wage. It meant a significant pay raise despite a likely decrease in productive output. Sponsored by one of the few Southern liberals in the Senate, Hugo Black, later to be appointed to the Supreme Court by Roosevelt, the bill was based on the argument, heartily supported by organized labor, that the measure would spread work and increase purchasing power at the same time. Neither Roosevelt nor any business group liked the idea for a variety of reasons. Leaders of the NAM, along with several corporate moderates, including Teagle of Standard Oil, testified against it, which reminds us that Teagle was not a minor figure on policy issues of major concern to the entire corporate community. Secretary of Labor Frances Perkins found the legislation unacceptable for her own reasons: it did not include a minimum wage provision.
Gerard Swope, the president of General Electric, and a friend of the New Deal, was named chairman of the BAC. Teagle was selected as chairman of its Industrial Relations Committee, which demonstrates the central role of the Rockefeller network in the corporate community once again. One of Teagle's first decisions was to appoint all the vice-presidents that were members of the Special Conference Committee to the Industrial Relations Committee, thereby making that private group into a governmental body. Rockefeller's personal employee, Edward Cowdrick, the aforementioned secretary of the Special Conference Committee, was made secretary of the new BAC committee. Reflecting the seamless overlap of the corporate community and government in the early New Deal, Cowdrick wrote as follows to an AT&T executive. The memo deserves to be quoted because it reveals one of the ways the corporate leaders explained their involvement in government advisory groups, as well as a decision to avoid any mention of the Special Conference Committee, even though the government advisory meetings were part of Special Conference Committee meetings. The members were told they would be there as individuals, not as representatives of their companies or as members of the Special Conference Committee:
At the BAC's first general meeting in Washington on June 26, 1933, ten days after the NRA itself was created, the NRA director asked Teagle to chair the NRA's Industrial Advisory Board, which drew the majority of its members from the BAC as well (McQuaid 1979, p. 685-686). Teagle brought Hicks, his recently retired industrial relations vice-president at Standard Oil of New Jersey, to join him in Washington as his personal assistant. (At this point Hicks was paid about $98,500 a year as a personal consultant to Rockefeller, in addition to his $163,500 a year pension from Standard Oil of New Jersey -- both those figures are in terms of 2012 dollars). Teagle, along with Swope and other business executives, then spent the summer of 1933 overseeing the development of the NRA. In short, the overlap between the corporate community, the Rockefeller industrial relations network, and the NRA was very extensive. This seems to be even more the case when it is added that other top businesspeople came to Washington to serve the NRA as "presidential industrial advisers" on temporary loan from their corporations. In other words, and this conclusion will rankle those who see the American government as independent of "big business," the corporate community was subsidizing, staffing, and building a new state agency. Moreover, it was happening at the very time that the corporate community supposedly had lost power and legitimacy, according to the modern-day experts that rule the academic roost when it comes to the understanding of the alleged ups and downs of corporate power (Finegold and Skocpol 1995; Hacker and Pierson 2002; Hacker and Pierson 2004; Hacker and Pierson 2010)}
Hicks went on to explain that it would not be fair to allow union leaders to "have a free hand to secure members on a voluntary basis" while at the same time saying that "such men as Mr. Teagle, Mr. Swope, and Mr. Kirstein should be forbidden to encourage and cultivate cooperative relations with their own employees..." Wagner replied with a cordial thank-you letter two weeks later, but a prohibition against employee representation plans sponsored by a company nonetheless appeared in the first draft of the legislation in early February. At that point the corporate representatives on the National Labor Board began planning a dinner meeting with Wagner for February 13, during which they hoped to convince him to adopt their plan for organizing the board for its current work, with Hicks playing an administrative role. But no changes were made on the basis of the dinner meeting.
While the du Ponts and NAM made plans to block any labor legislation that would strengthen section 7(a), Teagle, Kirstein, Swope, and Hicks lobbied Wagner for modifications in the draft legislation that would make it more palatable to them in case it did pass. They did so through a memorandum of suggested changes, many of them similar to Swope's comments via telegram. Teagle and Kirstein handed the memorandum to Wagner when the three of them had dinner in Washington on March 14 (Teagle 1934b). As Teagle summarized the results of the meeting in a letter to Swope the next day, "Generally speaking, the Senator expressed himself as feeling that most of the points we had made were sound and that the draft of the Bill should be modified accordingly" (Teagle 1934a).
The memorandum made several other suggestions that were standard items in the employers' argument by then. For example, coercion by labor organizers as well as coercion by employers should be banned and efforts should be made to solve problems through cooperative means. But the sticking point in the memorandum at the dinner discussion concerned a section of the draft legislation that banned employee representation plans that had been founded and financed by companies. Teagle and Kirstein argued that the issue was domination, not origins, but Wagner held firm, at least for the time being:
Based on this lobbying, the provisions banning all employee representation plans were removed from the draft legislation in late March. Let's count this as a small victory for the Rockefeller industrial relations network. Thus, this series of events suggests that Teagle and Swope still had some leverage with Wagner, especially when it is added that amendments to the Railway Labor Act in 1934 banned company unions. But Teagle and Swope obviously did not have the clout to bring about all the changes they wanted. In any case their partial success proved to be unnecessary. At the moment when Wagner was making the requested changes, Roosevelt intervened in a conflict between the National Labor Board and the automobile industry over unionization that put an end to their concerns for the time being. As part of his decision to move jurisdiction over automobile companies to a separate labor board, he rejected the principle of majority rule. It seemed to be a clear concession to the du Ponts and General Motors, and it was a great disappointment to liberals and union leaders. Roosevelt's decision meant that company unions could flourish alongside trade unions, thereby undercutting serious negotiations by employers with independent unionists (Gross 1974, pp. 61-62). If there had been any hope of restraining anti-union employers, this decision by Roosevelt seemed to kill it, at least for the time being.
Despite the setback on the Landrum Griffin Act and corporate talk about union responsibility for cost-push inflation, the labor movement appeared to be politically robust at the end of the 1950s, in part due to a merger of the AFL and CIO in 1956. The visibility and strike successes of several big unions that had major contracts with the large companies in steel, auto, rubber, and other major industries contributed to this impression, as did the activism and calls for greater government spending by the UAW. Appearances to the contrary, unions were in fact in a defensive and declining position in the overall power structure. To begin with, less than a majority of union members were registered to vote, and not all of them voted Democratic (Boyle 1995, Chapter 5). Further, the number of workers in unions had stagnated at about 17 million between 1954 and 1960, and the percent of wage and salary workers in unions had declined from its near-high point of 34.8% in 1954 to 30.9% in 1960 (Mayer 2004, p. 22, Table A1). 2ff7e9595c
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