Before the Storm

by Rick Perlstein

  But labor was prevailing in the political war—thanks largely to Walter Reuther, president of the United Automobile Workers. The son of a German immigrant beer truck driver and militant socialist who raised his sons to save the world, Reuther began his career as a labor organizer in the mid-1930s, just as unions were developing a dazzlingly audacious new tactic: at the opening whistle, activists simply sat down at their machines and refused to leave until the owners agreed to bargain with them. Sit-down strikes were wars, naked fights for power—struggles for control of the factory between the capitalists who owned them and the workers who breathed them life, management advancing with tear gas and blackjacks, the workers making their stand with whatever heavy projectiles they could find. The grandest of all the actions struck GM’s giant works in Flint, Michigan. It was a watershed in labor history. At the height of the uprising, in early 1937, the new Michigan governor, Frank Murphy, moved in the militia, and strikers prepared for the inevitable blows to rain down upon their heads. They never came. Murphy was intervening on the union’s side—because he owed his office to the UAW’s get-out-the-vote effort for him the previous November. This was an enormous lesson, the same lesson learned by Denison Kitchel, and Reuther was among the first labor leaders to grasp it: now the real battles were to be fought and won in the political arena. Previous labor leaders jealously guarded their independence from government. But Reuther rose by combining old-school shop-floor organizing, legislative-floor politicking to create a friendly legal climate, and precinct work to elect the politicians that believed in Walter Reuther’s grand left-wing vision, inherited from his father, that business, labor, and government, working together, could more rationally run industries than could private enterprise alone. He never saw his dream fulfilled. But with more and more labor-friendly politicians in Washington and the state capitals willing to back him up, he did manage to negotiate the most splendid contracts—and some of the most liberal laws—American workers had ever won. And that, to his enemies, was bad enough.

  Reuther became head of the UAW’s General Motors division in the 1940s. He understood the massive, exquisitely calibrated production system of America’s biggest corporation better than most of its executives. Knowing that just one small wildcat strike could render half a dozen plants useless, he began consolidating control of his members so that no wildcats would take place. Thus able to promise America’s largest corporation what it wanted—labor peace—he was able to gain unheard-of concessions in return: a contractual “cost of living adjustment”; then, in 1955, a historic “guaranteed annual wage” whereby, for the first time, workers would be paid during layoffs—65 percent of full pay when state unemployment compensation levels (which UAW lobbying helped increase all around the country) were added in.

  Walter Reuther soon became Public Enemy Number One in the offices of the kind of factory owner who supported Clarence Manion. Bargaining concessions won at the top of the industrial system had a tendency to trickle down as more and more workers demanded the same perks. But if the GMs of the world could afford these concessions—and, indeed, welcomed them because they greatly stabilized a company’s labor relations—smaller manufacturers insisted they could not. Moreover, these company leaders believed with religious certainty that in this plague of Reuther-style contracts, which increased wages year by year regardless of productivity, were recipes for inflation. The contracts were also un-American: “Strict seniority without regard to individual merit, equal pay for unequal work,” bathroom fixtures magnate Herbert Kohler said, “—these and similar bargaining demands of union leaders treat the workers en masse, not as individuals.” If on top of supporting unions the government unbalanced its budget with reckless spending thanks to unions’ undue influence in the political realm, inflation might race out of control. Union-shop provisions were the keystone of the entire edifice—so the right-to-work fight was the centerpiece of the effort to do “Reutherism” in. That 1955 GM contract, Clarence Manion railed in one of his first broadcasts, “moved Mr. Reuther close up to the supreme dictatorship of American organized labor as a prelude to a try for the presidency of the United States.” It was “offered at the point of a strike threat to practically every big industry in the country by a labor monopoly that is exempt from the antitrust law and can, therefore, callously disregard the public interest that every other person, corporation, and organization is obliged to serve.” (Reuther, of course, saw it just the opposite: the entire goal of the labor movement was to dignify the individual by removing him from the vagaries of market competition. This was the public interest.)

  Manion and Kohler could rage at Reuther. But he was a useful adversary; years later conservatives should have lifted a glass in his honor. There would have likely not been much of a conservative movement without him as catalyst. The audience for sweaty appeals for isolationist anticommunism was shrinking with every passing month. The fight against Reuther, on the other hand, was one that everyone who owned a business—and everyone who aspired to owning a business—could understand. And the timing was propitious. In the South, the struggle against the civil rights carpetbaggers was also turning moderates into conservatives.

  And in Washington, Barry Goldwater was inserting the fight against Reutherism into the McClellan Committee’s proceedings on union corruption at every turn. He was looking for a wedge to get Walter Reuther into the witness chair.

  The panel would ask a local Teamsters officer why the union had given $5,000 to the defense of a Portland district attorney indicted as a fixer for the city’s gangsters. Goldwater would change the subject, asking about a $2,000 contribution to the campaign fund of a local politician. Colleagues zeroed in on an admission from a Pennsylvania union officer that he operated goon squads to keep union members from attending meetings when Goldwater interjected: “Suppose union membership was purely voluntary, with no union shop or anything like that. Don’t you think attendance would be better?” The only effect these entreaties had on the hearings was to make them longer. The effect outside the hearing room, though, was to increase Goldwater’s renown as a conservative spokesman. And the spokesman was growing into the role.

  On the morning of April 8, Barry Goldwater’s phone at the Old Senate Office Building rang with a pleasant invitation: lunch at the White House to help plan his Senate reelection bid in 1958. Goldwater paused; cast his eye over his comfortably cluttered office, at the desert landscapes pictured on his walls, the models of the dozens of airplanes he had flown, his prized Navajo kachina dolls; and drew in his breath. No, he said, he did not think it was the right time to come to lunch at the White House. That afternoon, he admitted, he was going to denounce his President on the floor of the Senate.

  It was a crucial moment in the fiscal history of the United States. Conventional wisdom had always been that the symbol and substance of national economic health was a balanced budget. But with the Great Depression, Keynesian ideas began creeping into the thinking of the Democrats—that in times of stagnant private investment, government spending in excess of revenues could, by sloshing the citizenry in surplus cash, serve to “pump-prime” the economy back into life. For most Republicans such notions remained heresy. Now Eisenhower, buoyed by his landslide victory in November to break with the old Republican shibboleths and weighing the advice of his economic advisers that a recession was around the corner, had just submitted a record budget in March for FY 1958 of $71.8 billion.

  And on April 8 Barry Goldwater stood up in a nearly empty Senate chamber and delivered himself of a tirade. “Until quite recently,” he began, “I was personally satisfied that this administration was providing the responsible and realistic leadership so vital to the maintenance of a strong domestic economy which, in turn, is a vital factor in maintaining world peace.

  “Now, however, I am not so sure. A $71.8 billion budget not only shocks me, but it weakens my faith.”

  He addressed “Mr. President” directly—to tell Eisenhower that he was a betrayer of the people’s trus
t and a quisling in thrall to the Democrats’ “economic inebriation.” The President had embraced “the siren song of socialism,” “government by bribe,” “squanderbust government.” And Goldwater was only warming up.

  The junior senator now found himself cast in the press as the key player in the war rivening the GOP’s left and right wings. Time ran another profile: below file photographs of dumpy Joe McCarthy, William Ezra Jenner, and George Malone, whom Time labeled “The Neanderthals,” young Goldwater was pictured in the cockpit of a fighter plane. When the influential moderate Republican publisher John Shively Knight, proprietor of the Chicago Daily News and the Detroit Free Press, joined Goldwater’s brief against the Administration budget (“WE’VE READ ALL 1,249 PAGES! AND BROTHER, IS IT LOADED WITH FRILLS AND BOONDOGGLES!” blared the Daily News), mentions of the dashing Arizona senator’s name began cropping up in the press like dandelions.

  Goldwater was eager to put the dispute with Eisenhower behind him. He had Walter Reuther in his sights. Throughout the spring, stories had appeared quoting “unnamed Republican Senators” as saying that McClellan Committee Democrats—the Kennedy brothers especially—were blocking hearings about the UAW’s abuses in the calamitous strike at the Kohler Company outside Sheboygan, Wisconsin. In late May Goldwater stood before the 4,200 delegates to the forty-fifth annual Washington meeting of the United States Chamber of Commerce—and a goodly portion of the Washington press corps—to renew his call for $5 billion in cuts from the Eisenhower budget. Then he changed the subject: “Today, certain labor leaders bring to the bargaining table, not only the strength of their arguments, but the power of politics,” he said. “What Mr. Reuther preaches is socialism.”

  Bobby Kennedy, feeling the heat, sent a staff investigator down to Sheboygan to investigate the Kohler strike. They found no evidence of UAW impropriety of which the company was not equally guilty. But Kennedy knew that politically he had no choice. In July he convinced McClellan to prepare for hearings on the Kohler strike, and he sent out another investigator—this one handpicked by the Republicans. Even as he did, Newsweek quoted an anonymous Republican senator accusing the Kennedys of running a “Reuther protection game.” In fact, Jack Kennedy was not a fan of the labor left; journalists marveled at the senator’s indifference to this powerful Democratic bloc. The calumny was useful to Barry Goldwater, though. Reuther, Goldwater told anyone who would listen, was the biggest threat the country faced. “Here is a man, a socialist,” he spluttered to a group of unsuspecting Wellesley and Vassar girls who met with him on a field trip, “with all this power!” And he was zeroing in on a way to get that man into that witness chair.

  If there had ever actually been a consensus in the party over “Modern Republicanism,” the events at Herbert V. Kohler’s great porcelain works outside Sheboygan, Wisconsin, would have broken its back. The plant was located in a town called Kohler—a company town that the family began building in 1912, a gorgeous place with vine-clad brick houses, lush parklands, peaceful streets, and, bounding the village on its east, the sprawling industrial complex that made the bathroom fixtures that made the name Kohler famous nationwide. The Kohler family was proud of how it took care of its people. The recreation facilities were top-notch, and free; a company band gave free Monday afternoon concerts at the factory; the family, which had placed two members in Wisconsin’s governor’s chair since the 1930s, built Sheboygan’s harbor and its Home for the Friendless. Herb Kohler liked to brag that no worker was scared of him; he personally and proudly oversaw the naturalization process of his immigrant employees, many of whom lived in the lavish American Club boardinghouse in the center of Kohler Village. His factories anticipated Wisconsin’s pioneering workmen’s compensation law by two years.

  But there were grievances at Kohler Village, and they mounted through the 1920s. The provision of company health insurance did not make up for the number of retired sandblasters suffering from tuberculosis in nearby Knoll Sanatorium (known locally as Kohler Pavilion). Kohler paid by the piece on the theory that workers should be treated as capitalists themselves—as individuals responsible for their own risks and rewards. But that policy hadn’t kept him from hiring efficiency experts with stopwatches in their hands to weed out those workers who were unable to keep up the pace. If a crack was found on a piece taken out of storage for shipping, the man whose number it bore would find his paycheck docked years after the fact. Finally, in 1934, the workers struck. A dozen pickets were ambushed by eighty sheriff’s deputies; several were shot in the back. Two workers died. Herb Kohler still refused to recognize the union.

  By the 1950s Herb Kohler had added air-cooled industrial engines and precision controls for jet planes to his line. But he still ran his company town like a feudal manor. In 1952 the UAW won from Kohler workers the right to represent them. But it was only by the barest of majorities. This was worrisome: many of those who voted against the union were as zealous to turn back Reuther’s men as Kohler was. In 1953 the company signed its first one-year contract with the UAW. The next year, UAW agents began renewal talks by asking for far more than they knew they would get, as would any good negotiator : a twenty-cent hourly raise, a seniority system, union-run pensions and health coverage, an arbitration clause, formalized layoff policies, a union shop. Then the union agents waited for the company to meet them halfway, like companies always had, at least since the battles of the 1930s had settled into the working comity between capital and labor that experts called the “Treaty of Detroit.”

  But Herbert Kohler refused to negotiate.

  He had had enough of unions telling him how to run his company. His negotiator, Lyman Conger—an obligingly Dickensian villain, reedy-voiced, with a thin, cruel face, a hawkish nose, and a cleft chin—sent word through Kohler Village that there would be no slackening in operations in the event of a strike. Armed encampments were fashioned on plant rooftops; company officials held target practice on man-shaped targets. The union called a strike. Two thousand pickets surrounded the plant. Company loyalists who tried to make their way to work were harassed, sometimes beaten. A UAW official from Detroit pummeled a scab at a saloon; another attacked someone at a filling station. When a court ordered the union to let those who wished cross the picket lines, the action shifted to the community: those workers who dared to cross were visited by “house parties”—jeering union mobs. Local chemical supply houses did a brisk business in acid, used to deface property on both sides. The company infiltrated the union with agents provocateurs, dispatched comely lasses to entrap the leadership, and put a twenty-four-hour tail on National Labor Relations Board investigators. Through it all the factories were kept running.

  This was just not done. The UAW, stunned, hardly knew what to do. To save face, union agents abandoned their procedural demands; they would settle for a seven-cent raise. They would have taken less. They wouldn’t have got a contract at any rate. Kohler had unilaterally severed its relationship with the United Auto Workers—although, by the dictates of the Wagner Act, this action was against the law. Herb Kohler hit the businessman’s lecture circuit through 1955 and 1956 to advocate what amounted to Massive Resistance to the federal government. The UAW, he thundered, was telling him he had no right to operate. “This union dictate has been and is being defied by Kohler Company and by a host of men and women of courage who believe in their individual freedoms and rights, including the right to work!”

  The strike went on through 1957, an agonizing, slow war of attrition, the violence piling up on both sides. On August 20 James Riddle Hoffa spent five hours in the McClellan “Rackets” Committee’s witness chair. Lights glaring, cameras protruding, reporters climbing over each other to get a look, the Teamsters president was cornered into admitting to receiving $70,000 in outstanding loans from parties with business before the union, without collateral or note; to seventeen previous arrests; to returning $7,500 (“or maybe more”) to grocers in Detroit after he was brought up on charges of extortion. But when it came Senator Goldwater�
��s turn to ask the questions, Hoffa enjoyed a respite. They shared an enemy: Walter Reuther, whose idealistic, politicized unionism could not have been more different from the Teamsters’. “I do not believe that it is the original intention of labor organizations to try and control any ... political powers in this country for their own determination,” Hoffa said. Goldwater replied, “I think we both recognize that in the writing in the clouds today there is an individual who would like to see that happen in this country. I do not like to even suggest to let you and him fight, but for the good of the movement I am very hopeful that your philosophy prevails.”

  Two Sundays later on Meet the Press, Goldwater declared war. He said that the Republicans were determined to get the McClellan Committee to hold hearings on the UAW’s abuses in Kohler. “And subsequent to that,” he promised, “will be a full investigation into the affairs of Mr. Reuther’s unions as they apply to his control, let us say, of the Democratic Party in Michigan, and pretty much his control of the Democratic Party across the country.”