[OPE-L:5121] Re: Memorial Day, 1997

Gerald Levy (glevy@pratt.edu)
Mon, 26 May 1997 13:12:35 -0700 (PDT)

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A further question and then a follow-up question. Here's the context to
refresh your memory:

> Then, a surprise. John L. Lewis concluded a secret negotiation with Myron
> Taylor, chairman of the board of industry-leader United States Steel, in
> which US Steel agreed to recognize SWOC and accepted the *8 hour day* and
> the *40 hour week*.
> But the leaders of "Little Steel", a group of companies that included
> Bethlehem, Republic, Youngstown Sheet and Tube and Inland, refused to
> follow the lead of US Steel. In May and June, 70,000 steelworkers struck
> the non-union companies.

Here's my question: why did US Steel agree to recognize the SWOC?

My speculative answer is that Taylor realized that:

a) a strike by SWOC would severely cut into US Steel's short-term profits;

b) he probably thought that ultimately the union would win;

c) he, thereby, wanted to come to a "labor peace" and "working
relationship" with the CIO union, AND --

-- since he knew that US Steel had an absolute cost advantage in producing
steel, he knew that his competition in "Little Steel" could ill afford to
either pay higher wages or afford a long strike.

In short, he sold his brother capitalists out.

Follow-up question:

Yet, isn't this behavior is contradiction to what Marx tells us in V3,
Ch. 10?:

We thus have a mathematically exact demonstration of why the
capitalists, no matter how little love lost among them in their
mutual competition, are nonetheless united in a real freemasonry
vis-a-vis the working class as a whole" (Penguin ed, p. 300)

Of course, the above quote comes from the chapter on "The Equalization of
the General Rate of Profit." Once we consider markets that are dominated
by oligopolies and significant barriers to entry and exit exist, don't we
then have to re-consider firm behavior? For instance, some oligopolies
might agree to wage increases and benefits under some conditions because
of their competitive advantage in their market (as above) and *also* that
oligopolies could combine for mutual benefit (as above, with "Little
Steel") either to decrease wages or for the benefits of cartelization?

BTW, I think that it is appropriate that we discuss the meaning of the
Memorial Day Massacre on the occasion of its sixtieth (60) anniversary.

In solidarity, Jerry