Defending the Free Enterprise System: The National Political Arena

In early 1946 sociologist Robert Lynd observed that "the old liberal enterprise system is on the way out and business must organize and fight for its life." While acknowledging ideological differences with­in the business community, Lynd asserted that there was broad agree­ment among employers that their most critical problem was defin­ing the role of the state and of organized labor within the economy. Business, he claimed, was prepared to "spend unlimited money" in search of a solution. In particular, Lynd warned of business's most insidious tactic, the "selling of the 'private enterprise system' on the theory that if you control public opinion you have the government in your hand and labor behind the eight ball."

In the immediate postwar decade, there were a number of major national issues still open to debate. American society had yet to reach a consensus on the relationship of government to the economy, on the proper size of the welfare state, and on the scope of union pow­er in the factory. The two most central actors in this debate, the busi­ness community and organized labor, had both reaffirmed the im­portance of public opinion. Each launched strenuous campaigns to shape national politics and create a favorable climate of opinion for their opposing views. In many respects, these national campaigns framed a debate that would reach into factories, schools, churches, and communities over the next decade. At stake was the future of the American economy.

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Labor, particularly the CIO, had an aggressive political program for postwar reconstruction. With liberal Democrats and the support of the Truman administration, labor's legislative agenda Included tax reform, expanded unemployment insurance, price controls, and a higher minimum wage. The legislative centerpiece of a liberal-labor vision of the postwar order, was the Full Employment Bill. Labor de­manded that the government assure sufficient employment oppor­tunities for all Americans through support of private investments and, if necessary, by government spending. Full employment was to be the opening wedge for postwar economic expansion and the Keyne-sian program of using government spending to guarantee prosperity and security.

Factions of the business community mobilized to either oppose or mediate the content of government-guaranteed full employment. To members of the NAM and local chambers of commerce, the bill epit­omized the long slide toward state socialism. These business leaders denounced the Full Employment Bill and initiated a lobbying cam-paign against its passage. Moderate businessmen, equally alarmed, responded in a more sophisticated manner. Adhering to a policy of providing positive guidance, the Business Advisory Council and the Committee for Economic Development disseminated reports on the employment issue that accepted the Idea of a limited federal involve­ment in the economy but rejected compensatory government spend­ing as the solution to unemployment. Moderates like, George M. Humphrey of the M. A. Hanna Company, Ralph Flanders, Paul Hoff­man, and Chamber of Commerce President Eric Johnston, worked quietly behind the scenes to provide support for conservative Con­gressmen who sought to water down but not destroy the bill.

Moderate business leaders enjoyed the most success. When the Employment Act passed in 1946, gone from the final version was the government commitment to full employment and the provisions for mandatory spending. What was left met the specifications of the CED perfectly. The act provided that the government should affirm an in­terest in maintaining maximum employment through the establish­ment of research machinery to evaluate the state of the economy. The responsibility for providing employment, however, would con­tinue to reside in the private sector. It was, according to one Busi­ness Council activist a "pretty innocuous" bill.⁵ Moderates had tak­en important first steps In shaping the limits of the debate over the role of the state.

If the employment act was a victory for the moderate arm of the business community, conservatives were more concerned about elim­inating governmental price controls. The Office of Price Administra­tion had been effective in stabilizing prices during the war, and at the war's end, many liberals joined with organized labor in strongly advocating continuance of the OPA to check inflation. Even the moderate businessmen associated with the CED, while acknowledging their dislike for economic controls in peacetime, stood in fear of the dangers of inflationary pressures generated by the war. Most quietly advocated renewal of the OPA on a temporary basis and gradual re­laxation of controls.

Destruction of the OPA became the rallying cry of iaissez faire busi­nessmen who chafed under OPA regulations. Its continuance during peacetime symbolized to them America's drift toward collectivism. In late 1945, with the aid of industrial and commercial trade associ­ations, the NAM spearheaded a carefully planned lobbying campaign aimed both at the Congress, which was considering renewal of the agency, and at the public.⁷ In a lobbying effort similar to the one conducted against the Full Employment Bill, yet more intense, the NAM and other business groups testified before congressional com­mittees, pressured individual legislators, and the NAM spent over $3 milllion in 1946 to destroy the OPA. Half of that went to newspaper advertising. Full page advertisements directed toward consumers be­gan: "Would you like some BUTTER or a ROAST of BEEF" and alleged that OPA controls had discouraged the production of butter and driv­en meat onto the black market. Cartoons aimed at educators and cler­gy warned that the OPAs "artificial prices" along with wasteful gov­ernment spending and labor strife were the barriers blocking the typical American family from reaching prosperity.

The NAM held a series of meetings with industrialists to whip up local enthusiasm for the drive against price controls. It also sent speakers to make hundreds of talks before civic organizations, wom­en's clubs, and college students. NAM publications barraged over a hundred thousand school teachers, clergy, farm leaders, women's club directors, and over ten thousand weekly newspapers and columnists with anti-OPA statements. "Take the wraps—wartime price controls— off peace production and there will be such an abundance of things to buy as America has never known" the NAM proclaimed. It prom­ised that "if price controls are removed goods will then pour into the market, and then, within a reasonable time, prices will adjust themselves—naturally—as they always have—in line with the real worth of things." Yes, said the NAM, it supported price control but "price control by the American housewife, not by bureaucrats in Washington."

Too late, organized labor mobilized to protect the wartime con­trols that were due to expire in June 1946. It joined in a liberal alli­ance of teachers, consumer groups, veterans, and civic organizations to stave off a "joy ride to disaster." A "March of Housewives" paraded into Washington in April 1946, and two thousand women repre­senting consumer groups demonstrated outside the Capitol. UAW president R. J. Thomas warned autoworkers that the removal of price controls threatened recently achieved wage increases. Thomas accused manufacturers of "conducting a strike which makes the labor strikes look puny by comparison. This strike is against the general public, and its objective is higher prices. "12

Nevertheless, the conservative congressional coalition of Republi­cans and Southern Democrats gutted the OPA, and the NAM cheer­fully took credit. Prices immediately jumped, some as much as 25 percent in two weeks. Labor newspapers acknowledged the effective­ness of the employer campaign, conceding that some of the public and even some trade unionists had fallen for the NAMs "big lie tech­nique." A UAW local paper quoted the editor of a small Pennsylva­nia weekly: "When we saw that OPA was on the way out, we joined in the snake dance that was led by the National Association of Man­ufacturers and unwittingly swallowed the platitudes put out by that organization that the end of price control would increase production and lower costs." But, after several weeks of steadily rising prices, "we began to awaken to the fact that the NAM eyewash was irritating rather than soothing."13

The struggles against the Full Employment Act and price controls marked the resumption, on an even larger, more comprehensive scale, of the business community's campaign to undermine liberal and left-wing influence on American society, and to shift the political climate in a more conservative direction. The tenacity of liberal support for measures like price controls seemed to demonstrate that the conser­vative business community's worst fears about the lessons the pub­lic would take from the Depression and wartime experiences were not unfounded. Despite these early legislative successes, an expanded role for the state and government guarantees of security for workers through mechanisms like deficit spending appeared to be highly pop­ular. In October 1946, Westinghouse Electric Corporation vice presi­dent F. D. Newbury found "no clear demand by the American peo­ple, or program from the Washington Administration, for returning to the tested principles and practices of free private enterprise." In­stead there were "strong pressures within the Administration to per­petuate as much planning and control as the people would accept."^s

Conservative business leaders trying to mobilize the business com­munity issued almost hysterical warnings that the American way of life was under attack. One business journal in 1947 found that the world was in "the throes of a cataclysmic conflict... the lines of the conflict are clearly drawn. The coilectivist system on the one side, the capitalistic system on the other. A test for survival is in progress.", Leading the assault on business and the American way of life were trade unions assisted by the "pseudo-liberals, academic busy-bodies, columnists, 'enlightened' newspaper men, radio com­mentators and a galaxy of associated malcontents." Their "tirades" against free enterprise were not new, but the threat of communism overseas intensified the domestic danger.

From every direction, employers found evidence of the effective­ness of the liberal-trade union indoctrination of the public. Despite industry's war production record, the business journal Factory warned that business was headed back into its prewar doghouse. The pub­lic tended to be suspicious of industry, and it believed trade union "propaganda" about bloated corporate profits. Public Relations News found "incontrovertible" evidence that almost the entire public be­lieved that corporate profits were from double to ten times their ac­tual rate. In contrast, the labor movement "retains the public's good will—or at least its patient indulgence—in spite of stopping the pub­lic's trains, planes, boats, trolleys, elevators, and even turning off its lights." According to California businessman James L. Beebe, "the people of the United States have been fed and I think most of them have believed, that the state can provide jobs; that capitalism is on its way out;... and that it is the duty of the state to provide securi-ty (so-called) for all of its people.

Opinion surveys seemed to substantiate Beebe's fears. Factory's 1946 survey found that 47 percent of factory workers thought that the government would do most in providing new peacetime jobs. Simi­larly, the Opinion Research Corporation discovered that over 70 per­cent of workers believed that the government should guarantee jobs. For some corporate leaders the most startling revelation in terms of the outlook for business growth and survival was a Fortune poll that showed less than half of those interviewed believed hard work would pay off. All these findings seemed to demonstrate a lack of confidence among the public in the free enterprise system.

There were differences within the business community as to the perils facing capitalism. Most alarmist were the traditional conserva­tives associated with the NAM who had been finding evidence of a coming cataclysm since the days of the New Deal. Fred G. Clark of the American Economic Foundation, a conservative think tank found­ed in the thirties, asserted that businessmen from across the country agreed "that America is sitting on a volcano." Public relations experts, eager to promote their function in the corporate hierarchy, provided a steady stream of dire predictions to add to the anxieties of these business leaders. One public relations firm, for example, warned in 1947 that "our present economic system, and the men who run it, have three years—maybe five at the outside—to resell our so-far preferred way of life as against competing systems. "21

Sophisticated moderates, who accepted a growing role for the gov­ernment, were less likely to shout about America's drift toward stat-ism. They turned for evidence to the findings of opinion pollster Elmo Roper who emphasized the fundamental belief of Americans in the values upon which the ree enterprise system was based. But even the leaders of the CED agreed that the business community needed to protect its reputation and ability to decisively influence America's political culture. Paul G. Hoffman argued that it was "high time that we devote time and thought in bringing about public understanding of the role of profits in a ree economy. "23

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In the battle to save the "American way of life," businessmen uti­lized a combination of attack and persuasion. After World War I, con­servative business organizations had exploited public fears of radi­calism as a means of attacking organized labor. Ongoing concerns about domestic subversion and the Soviet Union again provided busi­ness with the opportunity to utilize anticommunism as a weapon against liberals and labor. In late 1945, business organizations, like the Chamber of Commerce, allied with patriotic groups, such as the American Legion, initiated a propaganda campaign against commu­nism in government and in the labor movement. Warnings of Com­munist infiltration of American institutions helped foster an atmosphere of intolerance. 24Symptomatic of their success in changing the political climate was the firing during 1946 (as the result of pressure from business sponsors) of dozens of liberal radio broadcasters. These sponsors also pressured other reporters to "tone down" news sympathetic to organized labor, Russia, or liberal causes. 25

The flipside of the battle against radicalism was the promotion of an ultrapatriotism. If international communism and domestic sub­version threatened American values, what was needed, according to Advertising Council Director Thomas D'Arcy Brophy, was a patriotic campaign that "would help by attacking the root of the evil, which is the loss of faith in our traditions. And it would help by selling the rewards still open to us individually and collectively, if we are will­ing to put American grit and sweat into our jobs." Such concerns led the business community to sponsor educational-patriotic programs like the Freedom Train, a red, white, and blue train that carried a car­go of historic documents to communities throughout the country. Beginning in 1947, the train emphasized individual rights and free­dom from coercion, a subtle attack on the values promoted by liber-als and trade unionists.

In Detroit, the campaign to associate patriotism with antiunion-ism was less subtle. "An American's Pledge of Loyalty" regularly broadcast in 1947 and 1948 over a Detroit radio station, implied that patriotic workers owed their allegiance to more than their flag and country. It read, "I pledge devotion to God and the brotherhood His word proclaims: I offer loyalty to the United Nations and the world order it is maintaining; I vow to defend America and the opportuni­ties it contains; I promise to give my best to America and American Industry and the homes it sustains." UAW Local 600 caustically not­ed that such sentiments implied that my country right or wrong had become my employer right or wrong. They sarcastically asked work­ers: "Did you give your best to American industry today." ⁷

The business campaign to sell patriotism merged into an equally fervent, if even more intense, campaign of persuasion to sell Ameri­cans on the benefits of capitalism. Employers believed in the Impor­tance of public opinion. If the public held industry in low esteem, it was because of a general misunderstanding fostered by organized la-bor through its denunciation of exorbitant corporate profits.

Between 1945 and 1947, new organizations emerged, with the purpose of aiding the business community in restoring "American" values. Among them were the Foundation for Economic Education, formed in 1946; the Industrial Information Institute, established in 1947; the American Heritage Foundation, organized in 1947 to spon­sor the Freedom Train; and the Advertising Council, reorganized in 1945 from a wartime agency. Ostensibly nonpartisan, these groups cooperated with such older opponents of New Deal liberalism as the Tax Foundation and the American Economic Foundation. Financial support came from the largest manufacturing corporations and com­bined firms with ultraconservatlve outlooks (the Du Pont Company, Sun Oil, and Republic Steel) with others at the somewhat less con­servative end of the business political spectrum, such as Ford and U.S. Steel.

There was variety in the messages emanating from these organi­zations and from individual companies. The most conservative, like the Foundation for Economic Education, emphasized absolute pro­tection of its version of America's freedom, particularly economic freedom. Those representing the more moderate wing of the business community, like the Advertising Council, recognized labor's right to free collective bargaining and acknowledged the necessity of govern­ment involvement in economic affairs where private interests proved inadequate. But, there were certain themes common to almost all the business efforts at mass persuasion. Among them were the importance of individual initiative and opportunity, the role of competition, and the necessity for profits. An N. W. Ayer & Son advertisement, for ex­ample, linked profits to "the same purposes as the wages a husband brings home Fridays," showing the relationship of profits to invest-ment and the growth of the American economy.

Finally, business groups hammered home the idea that a growing economy depended upon expanding productivity through the appli­cation of increased mechanization, power, and efficiency. In 1947, the business journal Factory warned that workers "led by mistaken, overzeaious, or ignorant prophets, can price themselves out of jobs, and industry along with them out of markets," unless they gave the "cooperation necessary for the production job that must be done." In 1948, a Warner & Swasey advertisement asserted, "It's just that sim­ple: if you want lower prices, a steady job, and more pay, you start with more efficient production. And there's no other way."

At the forefront of the effort to shape public dialogue was the Na­tional Association of Manufacturers. At the end of the war, the NAM gave top priority to expanding and intensifying its long-established public relations campaign against what it called collectivism. It as­serted that the "battle between the advocates of collectivism and those who believe in freedom and opportunity" had been rejoined after the armistice imposed by all-out war. The NAM believed it had to work quickly, contending that New Deal liberals and the CIO were preparing the American people for a "revolutionary change in the nation's economy." The strike wave, price controls, high taxes, defi­cit spending, and the "fallacious" principle of ability to pay as a fac­tor in fixing wage scales constituted a "master plan to remake Amer­ica." In 1946-47, the NAM countered with a multimillion dollar war chest to sell the free enterprise story and to promote the campaigns as opposing the Full Employment Bill and price controls. Financial support from the membership increased each year after the war. While six thousand of the sixteen thousand members of the NAM contributed to its public relations fund in 1946, over eleven thou­sand contributed the following year.

The NAM revamped its public relations program by hiring the Opinion Research Corporation to field-test potential advertisements for their ability to convey an idea and enlist sympathetic consider­ation. Members and advertising experts had criticized earlier NAM publicity for being too easily subverted and used by labor to label industry as selfish and greedy. "The story of business economics and philosophy needs to be told," declared NAM vice president for pub­lic relations Holcombe Parkes, "simply, understandably, repetitious -iy and without dilution or distortion—to broad masses of the peo­ple." Accordingly, it issued a constant stream of paid advertisements, news releases, speeches, posters, leaflets, and magazines. In 1947, the Industrial Press Service sent free material to 7,500 country papers and 2,500 company journals, while the organization's literature depart­ment distributed over 2 million pamphlets. Focusing on the four roadblocks to prosperity—price controls, labor relations, government spending, and taxes—the NAM bought ads in 265 daily papers and 1,876 small-town papers.

Similarly, it ran ads explaining profits in popular magazines like Harper's and Saturday Evening Post. A typical NAM ad illustrated the role profits played in industry, asserting that business's modest profits paid for the "expansion and improvement that bring more produc­tion, more and better jobs, lower prices and greater security for all." Half of the NAM $2.5 million public relations budget in 1947 went to national advertising and publicity. NAM ads spoke to the public's concern over economic security. One ad, for instance, featured Joe Vaughn who ran a food store in High Point, North Carolina. Vaughn wondered if "business firms, today aren't making too much profit." The NAM pointed out that industry profits were much less than the public believed and explained the vital role profits played in the "de­velopment and progress that produces more goods, more jobs, and greater security for all." Complementary efforts of other trade orga­nizations to explain the workings of the American economic system gave NAM'S program even broader exposure. ⁵

The NAM supplemented its written appeals with copy on other media. Its representatives regularly made personal contacts with ra­dio network officers, local station managers, and program directors and it distributed "Briefs for Broadcasters" to a thousand radio com­mentators. In 1946 it sought, recruited, and trained a staff of full-time radio debaters for participation in the popular forum-style pro­grams like Town Hall, complaining that busy and ill-prepared industrialists had not been particularly effective against opponents "trained in public brawling, armed to the hilt with facts and figures, and bug-eyed with zeal for the Leftist side of any debate. Begin­ning in 1947, The NAM sought even greater control, sponsoring a radio series, "Your Business Reporter," which reached 3 million homes. Moreover, the organization expanded its motion picture ser­vice to develop a wider audience before groups of employees, club members, educators, and students. By 1948, attendance at NAM films had reached over 2.5 million people a year. Films like "American Anniversary" and "Your Town—A Story of America" demonstrated the interrelationship of American freedoms, the value of individual ini­tiative, and the dependence of the community on the industrial pay­roll. "American Anniversary," for instance, told the story of Joe Kar-nak, a young immigrant, who, by learning to appreciate the "many freedoms and opportunities America offers," rose to local prominence and affluence.

The barrage of business messages promised to deliver immediate political gains. In the 1946 congressional elections, Republicans seemed poised for victory. Employers viewed this opportunity as ev­idence of widespread acceptance of their message that liberal gov­ernment and organized labor were to blame for the constant indus­trial strife, galloping inflation, and scarcity of consumer goods that frustrated the American public. Exploiting that frustration, Republi­cans campaigned on the issues of curbing union power and the ex­cesses of federal authority, repeatedly asking, "Had Enough?" Con­servative businessmen supported Republicans who linked labor disturbances to the "international Communist conspiracy." The Chamber of Commerce even released a report entitled "Communist Infiltration in the United States" at the height of the campaign. Mean­while, in cities like Milwaukee, division within the labor movement over communism helped undercut labor s political power. 38

When Republicans swept to a majority in both branches of Con­gress for the first time since 1928, the NAM interpreted the triumph as a sign that the public was "tired of government regimentation and boot-strap economics." The mandate, according to the NAM, was that our way of life is better than any other system in the world." To Charles E. Wilson of General Motors the election meant that "Amer­ica has chosen the fork in the road that leads to freedom and per­sonal liberty," away from government planning, unbalanced budgets, and "organized unemployment. "39

Conservative political resurgence combined with an apparent de­cline in labor's public esteem to give the business community a de­cided edge in management's emerging strategy to restore its lost au­thority and roll back union power. The NAM figured prominently in this first step toward a successful "recovery of the initiative" in la­bor relations. To change its greedy image, the NAM abandoned the demand for industrial self-rule, laissez faire, and the repeal of the Wagner Act. Instead, It publicly acknowledged workers' rights to en­gage in collective bargaining, but called for changes in public policy that would enable the state to Intervene on behalf of employers. At a time when a small minority of liberal businessmen were pursuing union-management accommodation, most, even in the moderate camp, joined the NAM conservatives in promoting a strategy of "re­alism." This was the strategy adopted by General Motors in the late thirties. It entailed reluctant acceptance of the principle of union­ism while actively attempting to weaken or contain labor power. By early 1946, it was clear to sociologist Robert Lynd that in labor rela­tions, liberal and conservative businessmen had become "brothers under the skin.

The first part of this multipronged attack on labor involved "the confinement and gradual reduction" of the scope of collective bar­gaining and union influence within the factory. This effort had be­gun toward the end of the war and intensified during reconversion, with the auto companies setting the trend during the 1945-46 bar­gaining round. Determined to save "our American system and keep it from evolving into an alien form imported from east of the Rhine," General Motors refused to negotiate with Walter Reuthei over cor­porate investment and pricing policy. Moreover, it provoked a work stoppage rather than capitulate to labor's attempt to expand the scope of collective bargaining into the realm of management decision mak­ing. Henceforth, bargaining would be limited to wages, hours, and working conditions. Similarly, seeking improved control, stability and predictability, Ford Motor Company won freedom to maximize production and security against unauthorized strikes. By late 1946, management had learned to make collective bargaining "a two-sid­ed proposition" forcing unions to "recognize the rights of manage-ment and the obligations of employees and union officials.

The second part of curbing union power involved revision of the Wagner Act. The NAM, together with such organizations as the Busi­ness Advisory Council, developed a set of legislative proposals that reflected the emerging business consensus on labor. The NAM argued that the business program was not punitive but was designed to make collective bargaining work in the public interest. Under the Wag­ner Act, former NAM president H. W. Prentis argued, unions had gained unlimited monopoly power without any legal responsibility. They intimidated their members and the public through mass pick­eting, boycotting, and violence, and crippled the country's econom­ic progress through restrictive practices that undermined productivity. Even more fundamentally troubling to Prentis was the "ominous rise of class consciousness, engendered by legalized labor union ac­tivity." The "House of Labor" intoned Detroit manufacturer Frank Rising, had become a nuisance in the neighborhood. What busi­ness spokesmen demanded was legislation that would bring balance between labor and management. The failure to protect employees and the public from unions resulted in ever increasing levels of industri­al strife.

Beginning in February 1946, the NAM aired its proposals to pro­tect employees by guaranteeing employer free speech, prohibiting union security clauses that interfered with the right to work, and reg­ulating internal affairs of unions. The proposals guarded the public rights by regulating strikes that threatened the nation's safety and by outlawing sympathetic and jurisdictional strikes as well as second­ary boycotts. In addition, requirement of proof that union officers were not communists would help rid the labor movement of subver­sive influence, while bans against union contributions to federal po­litical campaigns would limit organized labor's political power. Final­ly, the exclusion of foremen from collective bargaining would provide safeguards for the rights of management and help offset the union challenge to managerial prerogatives.

In the spring of 1947, the conservative business community threw its full strength behind the Taft-Hartley Bill, the labor reform legis­lation that came out of the Republican-dominated Eightieth Congress. Industrialists combined an intense lobbying campaign in Washing­ton with a commitment to obtaining public support through its new­ly expanded public relations mechanisms. The NAM alone spent over $3 million in the public relations drive that featured full-page ads in 287 daily papers in 193 key industrial centers. Always, employers couched their arguments for labor reform constructively, "in the public interest. "47

A compliant press aided business in mobilizing public opinion. The weekly Quincy Record of Illinois, for example, engaged in a blitz of pro-Taft-Hartley coverage, reprinting the bi-weekly talks of Henry J. Taylor, the General Motors sponsored radio commentator. Playing on public fears of radicalism, Taylor labeled opponents of labor reform as Communist fellow-travelers who weakened America by "hamstring­ing our individual effort through lopsided labor law... through spon­soring false economic doctrines that can bust us, along with politi­cal action dedicated to tying up management so that it cannot possibly manage." The newspaper added that Taft-Hartley was not antilabor. If workers would only look beyond their narrow class interests, they would see that the legislation would fight inflation by lifting arbitrary union rules "which exploit the worker in his other role as a customer of goods and services." Arguments such as these flooded the newspapers and airways. In June 1947 conservatives and the business community celebrated victory when Congress passed the Taft-Hartley Act over a presidential veto.

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The labor movement did not just surrender before this managerial onslaught. Its defense centered on two strategies. First, trade union­ists, the labor press, and their allies tried to counter employer propa­ganda efforts. In late 1947, for example, Senator Harley Kilgore blast­ed the NAM before the Senate. He exposed the various techniques used by the organization to "soften up the country/' and denounced its role in killing price controls, wrecking the Wagner Act, and attempting to "emasculate" the wage and hour law. Similarly, labor papers warned workers that business was funding "a vast outpouring of propaganda" designed "to convince the American people that labor is a 'monopo­ly' and that its organizations should be weakened to give business an even break." Indiana State CIO president Neal Edwards, sent letters to the membership seeking their help with "our efforts to expose the NAM for what it is,... industrialists organized for the sole purpose of pro­tecting their profit-bursting pocketbooks." Labor papers joined in the expose with cartoons lampooning the NAMS propaganda campaign. The employers' organization was invariably represented as an over­weight man in a top hat, who through the judicious use of money, 50 controlled a compliant Congress.

Particularly alarming were the seemingly nonpartisan campaigns to sell free enterprise. While the Advertising Council's campaign was in its planning stages in early 1948, the labor press pointed out that the project was an "audacious billion-dollar plan" designed to "sell the American people on the virtues of big business." Trade unionists chortled with glee when Marshall Adams, a director of the Associa­tion of National Advertisers, denounced the campaign, which boiled "down to an effort to cover up the evils of the private enterprise sys­tem and to propagandize against changes to improve that system." Similarly, the Railway workers journal, Labor, ridiculed these efforts: What is wrong with free enterprise, the paper asked, if "after having its own way all these years, it must now be 'sold' in this lavish way?"

Trade unionists asserted that the class nature of mass communi­cations prevented fair coverage. The CIO News charged that most daily newspapers and radio stations had close ties to an interlocking web of large corporations. It was only natural that the press would fol­low a policy of "damming labor at every opportunity while carefully glossing over the sins of the banking and industrial magnates who really control the nation. In 1946, the Greater Buffalo Industrial Union Council, infuriated at the "anti-labor" and "anti-CIO" cover­age of the Buffalo Evening News, resolved to expose the paper's in-tent to destroy the public s civil liberties and legal rights. Similarly, Pennsylvania unionists warned members against newscasters like Fulton Lewis, Jr., a propagandist in the employ of the NAM and the Republican party. UAW foundry worker Leroy Krawford, cautioning workers against the antilabor Detroit newspapers, simply urged: "Be­lieve only our union press and radio hookup which is paid for by you and staged by you to tell you the score."

"Watch out," organized labor also told its members, for those "pho­ny" opinion polls that provide ammunition to employers. A 1947 Opinion Research Corporation poll, for instance, apparently showed that while most workers opposed the Taft-Hartley Act, they support­ed ten of the most important provisions of the act when presented separately. These findings were publicized in a Look Magazine article, in corporate-sponsored full-page advertisements, and among factory employees and editorial writers. Labor and Nation charged that this poll was simply planned confusion. 55

In an effort to undercut the political uses of these polls in 1948, the Building Services Employees Union engaged pollster Robert C. Myers who reported that "much of the polling reported in today's newspapers and magazines is unscientific, biased, and slipshod." Meanwhile, the AFL accused pollsters of the "worst kind of fraud. They are big business organizations which are used to influence rather than measure public opinion." Trade unionists also pointed to soci­ologist Arthur Kornhauser's 1946 study of major public-opinion poll­ing agencies, which found that the questions on labor were biased toward a management point of view. Not surprisingly, since polling was a profit-making enterprise, according to the Pennsylvania Labor News, procorporation pollsters were featured speakers at a NAM public relations conference. 56

The second part of the labor union defense against business ag­gressiveness involved publicizing the union point of view. In gener­al, however, unions reacted to an agenda set by the business com­munity. A great deal of effort, for example, went into refuting employer calls for higher productivity. Walter Reuther declared that the employer propaganda campaign on productivity was an "effort by management to swell already scandalously high profits by sweat-ing still more profits out of workers.

Even more union literature sought to disprove employer charges that wage increases led to inflation. Following Keynesian reasoning, the CIO argued that rather than harming the economy, wage increas­es were necessary to sustain mass purchasing power and prevent a depression. In 1946, it widely publicized the Nathan Report, which demonstrated that wages could be increased 38 percent without price increases and without affecting profit levels. The CIO asserted that inflation actually came from shortages manufactured by employers to drive up prices and profits. To prove this, labor papers constantly charted increases in corporate profits in articles like one published in the United Automobile Worker entitled "Golden Goose Hangs High, Profit Orgy Paves Way to Depression." *

Unions did not have the means to offset biased newspapers nor could they compete with business groups in purchasing extensive newspaper advertising. Consequently, the labor movement looked increasingly toward radio as a means of gaining support for union programs. In 1939, the National Association of Broadcasters had adopted a code that prohibited the discussion of controversial issues except for political broadcasts on the radio. Many radio stations used the code to effectively bar unions from the airways while providing time to business groups. Succumbing to pressure from the AFL and the CIO, however, ABC began providing airtime in 1945 to the CIO's weekly program, "Labor-U.S.A." The program used music, stories, and interviews as "a good antidote to the antistrike poison you get from newspapers and from many radio commentators." Surprising­ly, Variety reviewed competing business and labor radio programs and found that "'Labor' is warm, ingratiating, and human," while the "exact antonyms characterize the 'business's pitch.'" When the "voice of ex-NAM president Ira Mosher was pitted against Tom Glaser sing­ing a ballad like 'Money in the Pocket/" it was impossible to "ex-pect anyone to cheer for the NAM.

To gain greater exposure, the CIO asked affiliates to urge their lo­cal radio stations to broadcast the program as well as a second net­work program sponsored by CBS, "Cross-Section—CIO." In January 1948, the CIO even tried to broaden its appeal, producing the first weekly labor quiz show. "It's in the Family" featured two rank-and-file families competing for a savings bond by answering questions about labor, the CIO, and current events.

As the antilabor assault intensified, unions began to aggressively challenge the coverage of labor on commercially owned stations. In 1946, the UAW petitioned the FCC for a hearing on censorship, charging that a Cincinnati station had refused to broadcast a pro­gram by the Catholic church regarding its position on organized la­bor. When commentator H. V. Kaltenborn "beat his gums too freely one night about the Allis-Chalmers strikers/' the local drew upon the fairness doctrine to force NBC to give it time on his program to "speak the truth." Two years later, the Geneva Federation of Labor, incensed at Fulton Lewis, Jr.'s attacks on social security and the labor move­ment, tried to drive him off the air by boycotting his local sponsor, the Geneva Federal Loan.

The trade union public relations efforts, however, lacked the re­sources and the sophistication of the business community's free en­terprise campaign. Of the national unions, the UAW and the United Electrical Workers were perhaps the most active. The class-oriented nature of the left-wing UE program partially backfired, however, for it provided fuel to business claims of Communist indoctrination of the working class. The UE's activities included the establishment of the first union weekly news broadcast, the distribution of a modest amount of literature, including a guide to community action and pamphlets directed at the public schools, and the production and distribution of motion pictures. The business journal, Public Relations News, characterized "Deadline for Action," the UE's first picture, as an "exceptionally well made and compelling movie which castigates business and industry as a gang of profiteers, war mongers and slave driv­ers." The film became almost as popular among businessmen as among workers as business groups bought copies to demonstrate the dangers facing America.

The struggle against the passage of Taft-Hartley revealed the limi­tation of union persuasion. In early 1947, unions lobbied furiously in Washington, organized a massive letter writing campaign, and held huge public protest rallies against the specter of antilabor legislation. The CIO promoted a publicity campaign entitled "Defend Labor Month" in an effort to mobilize local communities against the legis­lation. CIO publicity director, Len DeCaux, urging affiliates to ob­tain radio time to present labor's position, distributed radio spot announcements and scripts for speeches and interviews.65 Emulating the NAM, the AFL ran five advertisements in one hundred leading news­papers warning, "Don't be a NAM fool." Appealing to antiradical sen­timents, the AFL contended that "by prohibiting free bargaining among free men," Taft-Hartley "would wreck our nation's position as the defender of democracy and the champion of freedom in the fight to halt further expansion of Communism." In the last weeks of the campaign, the AFL topped off its written appeals with a daily soap opera that began, "Lady, down in Washington they're trying to push through a slave-labor bill that will slice your husband's envelope right down the middle," and with weekly variety shows featuring such popular stars as Milton Berle and Jimmy Durante.

Despite labor's efforts, the Taft-Hartley Bill became law. The busi­ness community seemingly had helped shape public opinion more effectively than the unions. According to one commentator, "the words 'radical labor leaders' have been linked together in people's minds as ineradicably as the phrase, 'damn yankees,' is in Georgia." ⁷ Similarly, local UAW leaders found that thousands of their fellow workers had "been stampeded into making grave mistakes due to the vast propaganda arms of the corporations." Critics charged that la­bor's effort had been too little, too late. The liberal journal Labor and Nation argued that the crucial period of political maneuvering before the introduction of the Taft-Hartley Act was distinguished "by a gen­eral passivity on the part of labor." Only at the very last minute did unions actively resist the congressional drive, and then their cam­paign was not effectively organized. Moreover, the split in the house of labor between the AFL and CIO meant unions never "united in a positive statement of aims" while industry presented a well-coordi-nated front.

The passage of the Taft-Hartley Act and the success of conserva­tive initiatives during the Eightieth Congress seemed to bode well for the Republican party and their business supporters as they ap­proached the 1948 election. The splintering of the Democratic party with the emergence of two third-party candidates, combined with the nomination of the unpopular Harry Truman, also added strength to the predicted guarantee of a Republican victory.

The Taft-Hartley Act, however, had galvanized the labor movement against the "reactionary" Eightieth Congress. In January 1948, CIO Secretary-Treasurer Emil Mazey sounded the clarion for action. De­claring that gains achieved on the picket line could be easily erased by political action, he asserted; "Organized labor must not and will not take these political and legislative defeats standing still. Orga­nized labor must develop new and more effective political weapons, not only to repeal vicious antllabor legislation, but to remove from office those lackeys of big business responsible for its passage."⁷

More effective political action entailed the AFL's formation of La­bor's League for Political Education and its formal participation for the first time in a presidential campaign. Wedded to the emerging anticommunist liberalism, the CIO rejected Henry Wallace's Progressive third-party candidacy and joined in an alliance with Truman, who had mended his fences with labor by vetoing the Taft-Hartley Act. The alliance with the Democrats was so intense that in some states, like Michigan, the CIO's Political Action Committee actually took over the party. 72

The PAC broadened its appeal for the 1948 campaign, carefully divorcing unions from communism and emphasizing that labor's objectives were "shared by the overwhelming majority of Ameri­cans." These included guaranteed full employment, adequate hous­ing, health care, education, social security, and the assurance of full political rights and equal economic opportunities for all "men and women in our country of every race, creed or color. "73

But more im­portant was labor's need to overcome rank-and-file apathy and get out the labor vote. Low turnout by workers frustrated with Truman had been a decisive factor in the 1946 defeat. Unions distributed literature, sponsored radio programs, and fielded an army of precinct workers to avoid repeating their mistakes in 1948. ⁷⁴

Another key was setting aside the bitter struggle between the AFL and CIO. In Massachusetts, for instance, faced with three "vicious anti-labor referenda," the AFL, the CIO, and the liberal organization, the Amer­icans for Democratic Action, formed a "historic pact" to overcome the disunity in the ranks of organized labor that had contributed to the 1946 "debacle". 75

Truman in turn appealed for working-class support by conducting a slashing antibusiness campaign. He charged that the Republican party was in the hands of big business. Speaking before a group of farmers, he accused those Wall Street "gluttons of privilege" of at­tacking the structure of agricultural price supports. Truman also warned that collectivism was not the only threat to the American way of life; "powerful reactionaries were also silently undermining our democratic institutions." Behind these forces were men "who are striving to concentrate great economic power in their own hands." These men controlled the Republican party, which recently had de­livered gains to the private power, big oil, railroad, and real estate lobbies. Wrapping himself around the image of the New Deal, Tru­man reminded the public that in 1933, it was the Democratic party that "drove the money-changers out of the temple and brought new life to our democracy."

In one of the sharpest class votes in American history, Truman won an unexpected victory over Thomas Dewey, his Republican opponent, and the Democrats regained control of Congress. Labor played a spe­cial part in that victory. Massachusetts CIO President J. William Belanger, who headed the coalition that helped defeat that state's anti-labor referenda, concluded that organized labor united with liberal forces, had overcome the power of "selfish wealth." Despite, the "great powers of their minion press, the persuasive voices of their radio hirelings, the inaccurate minds of the political pollsters," Be-langer continued, "the sound and patriotic common sense of the lit­tle men and women" had triumphed. Trade unionists celebrated the victory as a call for the extension of the New Deal. According to a Pennsylvania labor paper, the election "delivered a mandate for free labor unions, for extended social security, for increased education opportunity for ail Americans, for civil rights for all, for the end to dangerous profits and for control of inflation.

* * *

The results of the 1948 election stunned the business communi­ty. It indicated the tenuous hold conservatives had over the public. Business ideologues apparently had not convinced voters that free­dom from "government paternalism" was more important than the economic security promoted by both labor and the Democratic par­ty. Indeed, Truman had campaigned effectively for the repeal of the Taft-Hartley Act, the restoration of price controls to protect earnings, and the expansion of government spending. To a shaken business community, it was not inconceivable that many of their achievements would be lost. General Foods Vice President Thomas G. Spates, ob­served that "when the smoke of last November's election had cleared away there was revealed a... rededication to the policy of achiev­ing the more abundant life through more taxes, more spending, more controls and less liberty, and a clear declaration that the government should stand for the welfare of the people.

Moreover, the critical role of labor in the campaign convinced Spates and other businessmen that unions were even more political­ly powerful than they had feared. Business Week editor Merlyn Pit-zler warned a United States Chamber of Commerce gathering that the passage of the Taft-Hartley Act had "committed the unions to political activity on a scale and at a pace never before approached." The Taft-Hartley Act, designed in part to weaken labor politically, had seemingly backfired.⁷

What then, asked businessmen, was the lesson to be learned from the 1948 election? Was it impossible for the business community to sell its values and its world view to the American public? "No," thun­dered speaker William McMillen to the December 1948 convention of the National Association of Manufacturers. The election showed that "you just haven't done enough of what you have been doing." Businessmen, McMillen demanded, must intensify their efforts "to convince those Americans who are confused that the road to stat-ism, tyranny, and slavery is paved with good intentions and lighted with great 'welfare' schemes." Freedom, indivisible and unimpaired, he continued, was "the only fertilizer of well-being," and "teamwork based on mutual understanding is the only guarantee of either indi­vidual or collective happiness." Thomas G. Spates added urgency to McMillen's call for a renewed commitment from the business com­munity; time was short, he declared, but there still was "a fighting chance to save this nation as a democracy.

Both moderate and conservative business organizations vowed to redouble their efforts. The first major campaign, emanating from the moderate wing of the business community was already prepared. Fear-ful that ignorance of the benefits of the American economic system increased the public's susceptibility to Communist subversion, the Advertising Council had started planning an economic education campaign as early as 1947. The Council's Industries Advisory Com­mittee, led by General Foods and General Electric donations of $100,000, spearheaded fund-raising. Other substantial donors includ­ed General Motors, Johnson and Johnson, Procter and Gamble, Good­rich, Republic Steel, and Remington Rand, while four advertising agencies volunteered their services to create the campaign.

The Advertising Council's message stressed the need for free en­terprise to expand productivity through mechanization and increased efficiency. For six months, beginning one week after the 1948 elec­tions, radio spots barraged the public, and the four major networks pledged half-hour special programs on economic education. By 1950, the Council had placed before the public over 13 million lines of newspaper advertising, over 600 pages of magazine ads, 300,000 car cards, 8,000 billboards and 1.5 million pamphlets extolling the vir­tues of capitalism. Corporations ran Advertising Council-approved ads during the campaign. One Republic Steel advertisement, for in­stance, showed three men attacking a piano. It acknowledged that while the American way wasn't perfect, it beat "anything that any other country in the world has to offer." To help "tune it up" rather than "chop it down," Republic Steel called upon readers to vow to "work more effectively every hour I am on the job" and to send away for a free booklet entitled, "The Miracle of America." In it, Uncle Sam explained "Why Americans live better," "How machines make jobs," and "Why freedom and security go together." Look, Opportunity, and forty-one company publications either reprinted or summarized the pamphlet. Even the publisher of Junior Scholastic magazine incorpo­rated the complete "Miracle of America," in its March 1950 issue, making it the "main subject of discussion" in fifteen thousand jun­ior and senior high schools.

Moderate business leaders were not alone. The NAM was joined by several trade associations, including the American Petroleum In­stitute, the National Association of Electric Power Companies and the American Medical Association, in an effort to derail Fair Deal pro­grams on such issues as natural resources, public power, and health care. j. Warren Kinsman, chairman of the NAMS Public Relations Advisory Committee and vice president of Du Pont, reminded busi­nessmen that "in the everlasting battle for the minds of men" the tools of public relations were the only weapons "powerful enough to arouse public opinion sufficiently to check the steady, insidious and current drift toward Socialism."

In part, the business effort relied on intensifying earlier efforts. The NAM, for instance, increased its production of pamphlets from 2.5 million in 1948 to 6.5 million in 1949, to nearly 8 million in 1950. It also began new initiatives, including a new $1.5 million radio pro­gram featuring singers and interviews with business leaders. In 1950, the NAM turned to television, launching a weekly program, "Indus­try on Parade," which showcased companies, explained how prod­ucts were made, and demonstrated what industry gave to individu­als, communities, and the nation. Adopting a more subtle approach than its radio programming, the goal was to make industry "the sym­bol of progress and hope for the majority of people." The program had an immediate impact. In early 1952, Oklahoma City reported that the series ranked among the first five programs in popularity, and Milwaukee gave "Industry on Parade" a higher audience rating than Meet the Press, telecast in the same time segment.

Corporations as well as the NAM saw advantages in movies and television. Since the thirties, companies like Ford, Du Pont, U.S. Steel, and Firestone had sponsored highly prestigious classical music and serious drama programs designed both to improve the corporate im­age and to promote ideas. Ford, for example, laced its "Ford Sunday Evening Hour" with attacks on New Deal programs and government interference in business. In the late forties and fifties, corporations shifted this kind of programming into television. The Bohn Alumi­num and Brass Corporation's NBC program, for instance, regularly warned the public about the dangers of "Socialistic schemes" that looked safe but in reality were a "deadly poison" that limited "individual rights and freedom." Other firms dramatically expanded their production and distribution of movies to clubs, schools, churches, and theaters as well as to television. These movies ranged from sim­ple company promotions to sophisticated attacks on what business viewed as a growing socialistic economy. By late 1951, business-spon­sored movies reached an audience of 20 million people every week, more than one-third of the nation's weekly attendance at commer­cial movies. That represented a 30 percent larger audience than in 1950 and a 500 percent increase since 1946. 84

Corporations also sought more personal contact by creating a na­tionwide legion of articulate business spokespersons. In 1949, a joint committee of the Association of National Advertisers and the Amer­ican Association of Advertising Agencies instituted "Freedom Fo­rums," which were held on a regular basis at Harding College in Ar­kansas. At the first meeting, over 100 industrialists from companies like Armco, J. I. Case, General Electric, General Mills, Kohler, Quak­er Oats, and Chrysler sat through "long sessions of indoctrination in the fundamentals of our economic system." They discussed "the most effective channels of communication needed to give an under­standing of America to those who are confused or apathetic," and left "determined to interpret the system in understandable terms to both management and labor. "85

Although unions continued the activities that had worked so well in the 1948 election, domestic and foreign policy events combined to help create a more receptive audience for business, inexorably shift­ing the political center of gravity from liberalism. Anticommunism rapidly became the primary political motif. Between 1948 and 1950, Communist revolution in China, Soviet development of the atomic bomb, espionage cases, and McCarthy's accusations of Communist infiltration of the government created an atmosphere of crisis and ten­sion. With the outbreak of the Korean war, Truman, who had met stiff resistance to the expansion of the welfare state from a coalition of southern Democrats and Republicans, sacrificed what was left of the Fair Deal on the altar of anticommunism. All this and the renewed inflation touched off by the war lent credibility to the business warn-ing that something was fundamentally wrong with America.

Contributing to the nation's drift to the right was labor's own in­ternal anticommunism. In 1949, after years of struggle between left and right, the CIO expelled eleven allegedly Communist-controlled unions. An internecine battle ensued that crippled the unions of the electrical and farm equipment workers among others. The feuds and anti-Communist purges also played a role in the collapse of "Operation Dixie," the CIO's Southern organizing drive. Within the broad­er context of Southern racism and antiunionism, the CIO internal struggle over communism and the continuing rivalry between the AFL and the CIO ensured the failure of any significant organizing in the South. ⁷

In this political atmosphere, labor began to narrow its political vision. Labor's hopes for a sweeping expansion of the welfare state and for the repeal of Taft-Hartley receded but was not totally aban­doned. Unions, for instance, promoted a national health care pro­gram long after other elements of liberalism had given up on the Is­sue. Still, unable to immediately achieve security for all workers through politics, CIO unions pushed for worker security through col­lective bargaining. In 1949 and 1950, unions like the UAW and the Steelworkers achieved significant victories on the issues of wages and fringe benefits. But they also conceded much to the employer drive to increase productivity at the expense of union rights on the shop floor.

The 1950 elections revealed just how much American politics had changed. In Maryland, California, North Carolina, and elsewhere, Republicans rode the issue of anticommunism to victory. In Ohio, the struggle was even more clearly one of business against labor. In late 1949, the business journal Factory had warned that unions planned to punish those politicians who had opposed Fair Deal leg­islation; 1950, it opined, "promises to be a year of decision of Amer­ican industry." Only through collective action, and "by molding the opinions of large groups" could business prevail. Top on labor's list of enemies was Robert Taft, leader of the conservative branch of the Republican party and coauthor of the Taft-Hartley Bill. Business lead­ers rallied around Taft, who successfully appealed to rank-and-file workers. Wage earners, according to political analyst Samuel Lubell, supported Taft's candidacy to voice a protest against being told how to vote by national union leaders and because they bought the Re­publican argument that a PAC victory implied that labor was "run-ning the country.

Determined that the conservative cause should not lose momen­tum as it had after the 1946 election, business leaders moved to se­lect a Republican candidate who could win in 1952. Dwight Eisen­hower seemed the perfect choice. A World War II hero, he had broad popular appeal. Although, his political and economic ideas meshed closely with the moderate wing of the business community, his con­cern over "the insidious inclination toward statism" made him ac­ceptable to corporate conservatives. Moderate businessmen led by Paul Hoffman of Studebaker, Thomas J. Watson of IBM, and Harry A. Bullis of General Mills helped mobilize the initial grass-roots sup­port for Eisenhower's candidacy. Adlai Stevenson won the support of liberals and organized labor.

The most heralded issues of the election were communism, cor­ruption, and Korea. The business community, however, continued to stress the threat "Big Labor" and "Big Government" posed to Ameri­can liberty and freedom. In late September 1952, NAM President William J. Grede charged that "dictatorial union bosses" sought to "establish in Washington a government which will be a Labor Gov­ernment in name—as well as in fact." Business-sponsored advertise­ments in popular magazines inveighed against the dangers of gov­ernment dictation asserting that the welfare state crushed freedom. One ad began, "they don't keep feeding you cheese after the trap is SPRUNG," and cautioned that "to vote into office a welfare state is to "find you have voted away your freedom. "91