Will Congress Rescue the Unions?


ACCORDING to the U. S. Bureau of Labor Statistics, during the first seven months of 1941 a total of 2505 strikes, engaged in by 1,327,000 union workers, caused a loss of 15,750,000 man days of useful labor. This was five times as many man days as were lost through strikes during the first seven months of 1940, and 44 per cent more than the average loss of time through strikes during the first seven months of the five preceding years (1935-1939 inclusive).

The needs of our growing defense effort have not reduced strikes, but on the contrary have stimulated them.

With sons drafted for national service at $21 per month, and the prospect of lessening employment in non-defense industries, a growing proportion of American fathers and mothers are viewing this development with rising resentment — wondering as to the cause of it, and insisting that something be done about it.

At Kearny, New Jersey, they have just recently seen one of the great shipyards of the country, busily engaged on urgently needed ships, shut down because the management would not agree to discharge any workman who did not pay his union dues.

In Los Angeles last spring the Harvill Aircraft Die Casting Corporation, manufacturing 30,000 parts a day for six big aircraft companies, was struck by the local union for reasons that even its own national union would not approve. In attempting to enforce their demands the strikers would not permit the delivery of parts already manufactured on national defense contracts, nor access to the plant by designing engineers and managers.

In Detroit the Ford plant was struck as part of a campaign to induce or intimidate workers to join a union which at the time had not even attempted to qualify itself legally to speak for them.

In practically all cases increased wages were demanded, and generally granted. Most defense contract workers now receive more in a month than a boy drafted into the army will receive in a year. All too frequently there were also demands for unheard-of vacations with pay, just when we need the largest amount of working time from all our skilled labor.

But the fundamental issue was always essentially the same: namely, the giving to a labor organization of the right to control all those who may be employed in a given enterprise, backed up where possible — as at Kearny — by the right to require the discharge of workers who do not keep up union dues or otherwise comply with union requirements.

Obviously there must be more to this than meets the eye. It is clear that the right to control the employment of thousands of workers, and to enforce the collection of union dues and assessments, is considered a very valuable right — so valuable, in fact, as to outweigh even the considerations of patriotism in the minds of all too many labor leaders.

Many wonder why William Green, President of the American Federation of Labor, and Philip Murray of the CIO do not put a stop to all this. But their organizations have only certain limited powers, mainly for legislation and propaganda. The most important questions of labor policy are decided by the individual labor union in pursuit of the assumed self-interest of its particular body of workers. With regard to such questions the American Federation of Labor and the CIO have no authority and sometimes little influence. Beyond and behind each of them is a long line of constituent national and international unions, each independent, each with its own particular constitution, each a law unto itself. And behind these national and international unions are the thousands of their own locals, each with its own business agent, its own treasury, the ambitions of its own local leaders — and, all too frequently, its own racketeers. And even between the national unions and their own locals there are constant conflicts and usurpations.

And behind all this what is there? Well, that’s the story.


I have just come from the bedside of Julian Scholly in Temple University Hospital, Philadelphia. Julian Scholly is a skilled boilermaker, thirty-three years old, who lives at 2414 Sergeant Street, Philadelphia. But — alas!—he will probably never do another day’s work as a boilermaker. On December 3, 1940, in front of his own home, he was shot in the back. One of the bullets went through the spinal canal and is so lodged in the backbone that it cannot be removed. Julian Scholly is paralyzed from the waist down — the result of union bullets.

What was Julian Scholly’s offense? Was he unwilling to work? No, indeed. After ten depression years, with little employment in his line, he was ready and willing to work full time. Was he a scab? No, indeed. He was a leading member of Local #13 of the International Brotherhood of Boilermakers.

Julian Scholly’s offense was great, nevertheless. He had the naive idea that the constitution of the boilermakers’ union meant what it said, and was supposed to be obeyed. One of its provisions was that candidates for membership should be posted, and admitted by a vote of the existing members. Another provision called for a monthly report of all moneys collected and disbursed. Still another provided for the annual nomination and election of the officers of Local #13.

In 1937 the parent international union sent an organizer to Philadelphia. When this organizer started taking in new members without posting their names or giving the existing members their lawful opportunity of voting on these candidacies, Scholly protested. When — in the absence of any authority or authorization — this same organizer arranged to have the timekeepers on the various jobs deduct a 5 per cent assessment from the pay checks of the various union members, Scholly again protested. And finally, when on top of both of these unauthorized policies it was impossible to find out what was being collected from the members of Local #13, and repeated requests for a full financial statement were ignored, Scholly demanded an outside audit by certified public accountants.

This was the situation in 1939, when the organizer from the international fell sick and had to retire. Although he had violated the constitution in his method of taking in new members and collecting assessments, it was generally conceded that he had been energetic in uncovering new work and increasing employment. The new members all came from the Philadelphia district — in contrast to the later importation of outsiders, as will appear — and most of them were apparently reasonably well-qualified boilermakers and helpers. So far as I can learn, up to this time there were no charges of favoritism in distributing the opportunities for work among the members of Local #13. In short, at this point the application of the simplest rules of fair play, and a resumption of the constitutional procedures with regard to electing members, collecting assessments, and making regular financial reports, would have harmonized all differences.

But just at this point a new organizer appeared, Lee Denny by name. He was said to be a relative of the president of the international union, who is up for reelection this fall, and had a possible interest in controlling the vote of the Philadelphia local in the convention. In any event, on Denny’s advice, President Franklin of the international union, by a letter dated September 15, 1939, superseded the locally elected administrator of Local #13 with a Board of Control selected by Denny. This Board refused the members of Local #13 their constitutional right to nominate and elect their own officers for the year 1940, leaving the Board in full control of the affairs and income of the local.

The previously elected business agent of the local, McShea, had not been removed from office as yet, but Denny gradually usurped his right to apportion among the members the new opportunities for work as they came along. In the course of this struggle Denny imported, and illegally placed upon the membership roll of Local #13, more than a hundred men from out of town. Among them were strong-arm men and criminals. One was a professional burglar, through whose detection and arrest the Philadelphia police cleared up some sixty-five robberies. These illegal importations from out of town were given work in preference to Philadelphia members who had the courage to protest against continuing illegalities. Thus, on a boiler installation in the plant of Henry Disston & Son, in North Philadelphia, twenty-one outside boilermakers were imported by the usurping management of Local #13, while dozens of protesting members of long standing — all residents of Philadelphia — were forced to go without work.

Finally, on May 12, 1940, McShea resigned; and — effective May 27, 1940 — William Allison, brought in from Montana, was appointed acting business agent by the Board of Control in place of the locally elected representative of Local #13.

Meanwhile, on the day following McShea’s resignation, the charter of Local #13 was suspended at Denny’s request, and its members were thus automatically deprived of their rights to meet and vote on anything. Scholly and his associates advised the members to refuse to pay any further dues or assessments until their charter and right to local self-government were restored. On November 18, 1940, Scholly and all those who had followed his advice were suspended from membership; and on December 3, 1940, Scholly was shot and crippled for life, inadvertently winning the esteem and respect of all persons capable of honoring courageous opposition to high-handed and lawless administration.

But before he was shot Scholly and his associates filed a petition in the Court of Common Pleas of Philadelphia, demanding reinstatement as members of Local #13, the restoration of its right to self-government through an election to be ordered by the Court, and an audit of the local’s financial affairs.

This petition was arbitrated for the Court by James L. McDevitt, Chairman of the Pennsylvania State Federation of Labor. On February 6, 1941, McDevitt ordered that Scholly and his associates be restored to membership; that jobs be found for them in thirty days, if available; that thereafter local members should have the preference for all available work until the Philadelphia membership was fully employed; that Local #13 should be entitled to nominate candidates at its June meeting, and to elect a complete set of officers at its July meeting — and an independent outside audit of the local’s finances was filed. McDevitt further found that ‘in his determination to eliminate business manager John McShea from office and gain complete control of Local #13’ Denny had filed untruthful reports with the President of the International Brotherhood of Boilermakers.

In the later stages of this small but illuminating struggle there is not a scintilla of comprehension, on the part of those in power, of the obligations of decent administration. On the contrary, there is an utter lack not only of respect for the constitution of the union and the law of the land, but of the simplest elements of fair play. This effort to control one local of an international union did not even stop with padding the membership and depriving bona fide members of the union of the right and opportunity to work. It went far beyond this to conspiracy to commit assault and battery with the intent to kill. Of the five men indicted for that crime on Julian Scholly, one pleaded guilty; two were convicted of the offense as charged, one of a lesser offense; and one was discharged for lack of proof.


Lest it be thought I have picked out one isolated example, let us shift to the present equity term of the New York State Supreme Court at Albany, and call the case of Frederick W. Dusing, et al. v. Samuel Nuzzo, et al. Frederick W. Dusing et al. are members of Local #17 of the International Hod Carriers, Building and Common Laborers Union, suing for the membership generally. Samuel Nuzzo et al. are the business agent and administration of Local #17, who have been holding office for at least four years without going through the formality of being elected annually in accordance with the constitution. During these same four years, thanks to the prosecution of New York water supply projects in the territory of Local #17, its membership had grown to about 6000. The complaining members of Local #17 assert that about $600,000 had been collected in dues, assessments, and initiation fees between 1936 and 1940, which had not been accounted for in monthly financial reports required by the union constitution. They also allege that Nuzzo and his associates conspired to avoid the annual election required by the constitution; that members who objected to the irregularities of administration were threatened with violence, sometimes deprived of jobs, and at other times paid less than the prevailing rate of wages.

The defense was, among other things, that elections had been suspended and the affairs of Local #17 had been conducted under the direction of the International Union. Mr. Justice Bergan found that ‘ the International itself has not had an election of officers in thirty years, and defendant Nuzzo, who has been active for years in its affairs, was unable to say by what authority its officers occupy their offices. The futility of applying to an organization thus antipathetic to the elective process for failure of a subordinate union to comply with the directions of its charter in these respects need not be labored.’

Judge Bergan also said: ‘The right to membership in a union is empty if the corresponding right to an election guaranteed with equal solemnity in the fundamental law of the union is denied. If a member has a “property right” in his position on the roster, I think he has an equally enforcible property right in the election of men who will represent him in dealing with his economic security and collective bargaining.’

Judge Bergan likewise found that ‘certainly the admitted violations of the fiscal directions of the local constitution, existing over a long period, require that the officers account to the members for their money.’ Accordingly he ordered an election of officers and an accounting by the present officers of the moneys they had collected and disbursed.

At St. Louis on September 15, 1941, the International Hod Carriers Union opened its first convention in thirty years. The president, Joseph V. Moreschi, who had held office since 1926 without ever having been elected by the membership, attacked Compressed Air Workers Local #147 of New York and the North California District Council, and reported that both were under investigation by the parent body. These two locals were leaders in the movement to force a convention and to have an election of officers of the international union. That antipathy ‘to the elective process’ mentioned by Judge Bergan as having characterized the international for the previous thirty years was apparently still flourishing; and once again outstanding elements of union membership that challenge undemocratic conduct of union affairs were threatened with punishment.

On January 31, 1934, the United States Senate committee investigating racketeering took testimony on the relation of the American Federation of Musicians, the parent union, to the Associated Musicians of Greater New York, its New York City local. The president of the parent union apparently has the power to appoint officers of the local, as a result of which its affairs are run in practical disregard of the wishes of the New York City membership. For years no financial reports were made to the local membership, although dues and fines were said to have amounted to $300,000 in a single year. One individual fine was for $2000.

Readers of the Atlantic will recall that during the past year Thomas E. Dewey, District Attorney of New York County, secured the conviction of the president and a second high official of another international union for the theft of funds from its treasury.

But, even if we pass by cases of outright theft, it is clear that violent competition is going on for the control of various labor organizations; that in this competition the rights to local selfgovernment and an equal division of the opportunities for work, the provisions of union constitutions, and the most elementary requirements of fiscal accountability, are all being violated.

Why should this be? The answer is simple — for the power and place resting on the control of an enormous income, which for the year 1941 may exceed half a billion dollars.

At first blush this may sound preposterous. Didn’t we read last fall that the annual income of the American Federation of Labor had been less than $2,000,000? We did ($1,983,483 receipts and $1,768,836 expenditures for the fiscal year ending August 31, 1940). But the various national and international unions that make up the membership of the American Federation of Labor probably collected and disbursed more than a hundred times these amounts. What they paid into the American Federation of Labor was a very small part of their own receipts.

At its 1940 annual meeting, the CIO ‘ by the advice of counsel ‘ made no financial statement. But here again whatever the central organization collected was negligible compared with the income of the constituent unions.


While nowhere are the facts collected and put together in one place, yet it seems possible to make a reasonable approximation of the membership and income of our American labor organizations.

First, as to membership. As of August 31, 1941, the American Federation of Labor reports that its constituent unions had 4,569,056 dues-paying members, an all-time high. In 1940 the CIO reported approximately 4,000,000 members, and the number has probably not declined during the present year. The great railroad train-service brotherhoods have approximately 500,000 members. So in these three groups alone we find approximately 9,069,000 members — possibly about 9½ million. This does not include a number of strong independent unions (like the Typographical Union) affiliated with none of the above groups. It is therefore conservative to conclude that at the present time more than 9,000,000 American workers are contributing to their respective unions.

Second, as to income from dues. Monthly dues are practically never less than $1.00. A common figure is $2.00, but $3.00 and $4.00 dues are also encountered not infrequently. Perhaps $2.50 a month, $30 a year, is the most reasonable estimate. Hence the dues income of American labor organizations for 1941 must come pretty close to $270,000,000.

Third, as to income other than dues. In many trade-unions, assessments, consisting quite generally of 5 per cent of weekly wages, are much more important than dues. With full-time employment at present wages these assessments run from $100 to $150 per member annually. This source of income is especially high among the older unions of the American Federation of Labor. It is smaller or nonexistent in the younger unions of the CIO group. Nevertheless, assessments collected in 1941 will probably amount to more than $150,000,000. Then the income from initiation fees is far from negligible at present, although in times of low employment it falls away rapidly. In Julian Scholly’s union the fees are $75 for a boilermaker and $60 for a boilermaker’s helper. Testimony before Judge Bergan in the case of the International Hod Carriers Union indicated an initiation fee of $36 in the earlier years, rising to $76 at present. The carpenters who built Camp Meade are estimated to have contributed more than $400,000 in initiation fees alone to one local of the carpenters’ union. The 1941 income from such fees may approximate $50,000,000. There are also special and strike assessments levied, fines imposed, and, in the older unions, some considerable income from investments.

For the year 1941, at least, it seems reasonable to conclude that union income from sources other than dues will be not much less than the $270,000,000 collected from dues. Hence total union income will probably equal $500,000,000, and may exceed it.

Perhaps a third or a fourth of this amount will be fully reported and properly audited by the better-run national and international unions, the American Federation of Labor, and organizations like the railroad brotherhoods and the Typographical Union. Some of these reports will compare favorably with the best corporate accounting and publicity. But two thirds or three fourths of these enormous receipts will never know an independent audit. Perhaps $300,000,000 will be retained by local unions, many of whose officers and business agents will never make a report worthy the name, and some of whom look upon demands for audits and financial statements as personal affronts, to be answered sometimes — as in the case of Julian Scholly — by attempted murder.

The pot of honey which attracts the insects is this large proportion of union income that has never hitherto been adequately accounted for. For the year 1941 it will probably substantially exceed $300,000,000. This is what the racketeers and gangsters in the labor movement are fighting for. As things stand today, those who contribute this enormous amount out of their wages will never know why or how a large part of it was spent.

But three things we do know, without any audit: that the great conspiracy of silence and concealment covers purposes which do not wish to see the light of day; that one of these purposes is financing the widespread use of force and violence, and the maintenance of a loose standing army of gangsters; and, finally, that this violence is directed not only against public peace and order, not only against scabs and members of rival unions, but against the most sober and responsible elements in the union membership itself. The first recourse of every labor union administration that is usurping power and spending money without accounting for it is the threat of violence and intimidation against that portion of its own membership which has the courage to demand correction of abuses.

In the 1933 Convention of the American Federation of Labor a delegate named Suny, from a cleaners and dyers’ local, introduced a resolution which read in part as follows: —

In the American Federation of Labor unions there is a new use of gangsterism and racketeering — the numerous trials of union officials on charges made by the dues-paying membership reveal only to a small extent the scope of this corruption. These exposures by rank-and-file members are followed by reprisals organized by gangsters paid from union funds by corrupt officials in which union members are killed and maimed in large numbers. . . .

This resolution, together with the entire discussion of it, was expunged from the record, and does not appear in the final printed proceedings. But Professor Norman J. Ware, in his Labor in Modern Industrial Society, says that there is nothing in the above statement that wasn’t true, and nothing that had not been proved in court. He points out that ‘the numerous trials of union officials’ referred to were of local, not national, union officers.

This is a condition of long standing, the correction of which has been evaded. Why, then, should we wonder at the numerous current evidences of irresponsible labor leadership? What else have we a right to expect? We have done many things to inculcate the belief that labor leadership is above the law. We have done practically nothing to establish by law the most elementary requirements of responsible union management. By this failure we have deprived the rank and file of union membership of any effective opportunity to direct and control that management.

By law we have taken the union into a respected and important place in our organization of industry. By law we owe it not only to the public interest, but to those millions of our fellow citizens who must now perforce belong to these unions, to require that they shall be fairly and honestly administered.

Each step toward the closed shop, compelling union membership as a prerequisite to employment, each step toward making the employer deduct union dues from wages, or to discharge workers who do not pay them, or to uphold union discipline, simply makes more imperative the necessity of seeing that union administration is fair and honest. If it is not, then we have subjected the livelihood of our workers to unbridled tyranny and corruption.

For the use of fraud, violence, and intimidation is not confined to the election of union officials, or their perpetuation in office without elections in violation of union constitutions. When a violent labor leadership has determined to call a strike, the same fraud, violence, and intimidation are resorted to. Last winter the Secretary of the Navy offered proof that some thousands of fraudulent votes were cast for the strike in the AllisChalmers plant at Milwaukee. In connection with the recent closing of the Federal Shipbuilding plant at Kearny, New Jersey, apparently no proper strike vote was taken.

All true believers in free institutions will long balk at the virtual slavery that lies behind denial of the right to strike or even of compulsory arbitration. Neither is it any answer to have the government seize industrial plants because needed work has been stopped by an unreasonable union demand. Our first answer must be to make it as plain and easy as possible for the great majority of union members to establish and maintain union managements that are law-abiding and responsive.

Besides — if we are going to come out of this war situation a stronger and more united people, as the English apparently are on their way to doing — we must rely as far as possible on freely given cooperation, and as little as possible on force. Although I have been an executive of a big corporation, and my whole business experience has been on the employing side, I assert my confident belief that the overwhelming majority of our fellow citizens who are members of labor organizations are just as patriotic as the rest of us. They deserve the opportunity of showing that this is true. We all need the spiritual strengthening that would flow from their doing so. There is a method of conducting affairs that is not only consistent with the democratic way of life, but far more effective with free men than constant recourse to unadulterated force. A strike vote, for instance, is a serious matter. We have a right to throw safeguards around it. But let us pass laws adequate to enforce responsible administration of our unions before we turn a willing ear to the denial of the right to strike under any circumstances.

Why shouldn’t annual union elections be required by law?

Why shouldn’t union members have the protection of a secret ballot in union matters as well as in political matters?

Why shouldn’t it be a felony to stuff a ballot box at a strike vote, or a union election, just as much as to stuff it at the polls?

Why shouldn’t regular financial reports of union moneys collected and spent be required by law?

Why shouldn’t such statements be verified under oath, and willful misrepresentation be punished like any other form of perjury or fraud?

Why shouldn’t independent outside audits of such statements be required by law?

Why shouldn’t union officials be required to distribute the opportunities for work fairly among their members, and the failure to do so be a crime?

Why shouldn’t the use of force, intimidation, or misrepresentation be just as illegal for union leadership as it already is for the employer?

Why shouldn’t each labor organization be required to file with the National Labor Relations Board, at least annually, its place of business; the names and addresses of its officers; their term of office and compensation; the date of their election; the scale of dues, assessments, and fines; latest financial statement; constitution and bylaws; and any other information necessary to maintain an open and aboveboard relationship with its own membership, the government, the press, the employer, and the general public?

In short, why shouldn’t the management of organized labor now be required to take its place in the sun with the same degree of publicity and accountability as the management of corporations or of political parties?

Just and able administration of union affairs is as honorable and important a job as corporate management or public service. Nothing that I have said is meant to imply that we do not have such leadership in some of our unions. But of itself it cannot cut down the brushwood of concealment and irresponsibility in which unfair, violent, and lawless management finds today so extensive a cover. That is a job for the lawmakers.