Be you an admiral, lieutenant, chief or a freshly caught youngster, you have a budget. You may never have thought of it as such and will scoff at the idea of any such mathematical precision on your part. There is just so much money coming in; the needs which must be met will cost so much; and it is up to the good wife to see to it that the two shall not be too far apart. Furthermore, regardless of your present status, you are headed for retirement or separation from the Navy. That is just as sure as death and taxes, and both are only too sure, particularly taxes. You may make a dignified exit on the shoulders of six stalwart seamen or, more prosaically, find yourself on the list of those separated from the Active List of the Navy prior to that longest cruise of all. In the Navy you will be remembered as Wild Bill, Juggy, Windy, Squeeky, Smiling or Sundowner So-and-So.
You will find yourself looking back over the years in the “Good Old Navy,” when the Navy was a Navy, and confronting instead the future to be spent in an alien world of civilians. Your viewpoint will change from that of what is best for the good and glory of the Navy (known as esprit de corps) to that of what is necessary for you, yourself; for your family and for the good of the land which you have served, ego somewhat displacing corps. Your thinking will be less in terms of the nation’s foreign problems; you will be troubled with the more pressing problems of your own immediate needs and the welfare of the nation as Our Country. You will be urged to elevate your viewpoint above national considerations and to think of this world as one vast Brotherhood but, bred in the bone, you will find it difficult to sublimate your once so-prized Red, White and Blue viewpoint to any other color or combination of colors no matter how cleverly blended. To you, the Stars and Stripes will continue to be an emblem and the ONE DOLLAR on the face of a greenback will stand for guaranteed value, backed up by all of the honor and integrity of the United States of America.
One year ago, $5.69 would buy you a ride from Washington, D.C. to New York City. Today that same convenience costs you $7.75—and the shadow of a future increase is before us. Are we taking a ride or being taken for a ride? What has happened to the value of our dollar? When you become a civilian, you hand over cash for that ride, not a paper transportation request. It is your money, coin which you like to jingle in your own pocket, which goes to make up the present 36 per cent increase in the cost of the journey. The next increase in the cost of transportation will diminish the merriment of the pocket jingle. If your dollars come from retired pay only, they prove to be pitifully few and are not increased in numbers every few months as are the take-home dollars of so many of the so-called working trades. Service pay is becoming increasingly less attractive as compared with the wages of civilian labor, and the intangibles, such as hospitalization and retirement benefits, are no longer peculiar to the Services. Service pay requires a specific Act of Congress, whereas the increase in pay of the workers just requires action.
Those people who are in the military services or who are dependent upon Federal salaries are neglectful of, or uneducated to, the present trend in the civilian and business world. Actually, they should be the most concerned, for the round of increases in salaries and pay for any given job or position comes to them but once in a generation, not as the increased benefits of various sorts come to the members of the trades unions, about once a year, just like Christmas. As individuals, the military share the costs, direct and indirect. As heads of families they help hold the props under the elevated costs of farm products, pay more and more for Junior’s shoes, and carry their load of all of our vaunted national well-being. As taxes increase, their take-home dollars just naturally shrink. We all have a real stake in this matter of increasing wages, costs, and monies in circulation.
A few facts as to money matters in the world of civilians are illuminating, although they may not be too bright. Considering the Philadelphia area as a fair example, let us see what labor, should we need it, would cost us under the highly organized setup of the Building Trades. Are you surprised to learn that it would cost you over $4 an hour for each carpenter of a group that you would employ, and that you would be required to employ a supervisor at a higher rate to guide their efforts? Should your project require other than purely carpentry work—and practically every job does—you would also be required to call in labor in the other associated trades at correspondingly high rates, with costly supervision for each and every trade employed. It is then that you become acquainted with the term “featherbedding,” a practice which is frowned upon by many good men in the very unions which promote and sanction it.
What is featherbedding? It is a means of manufacturing employment where none existed before and of making available more take-home dollars in the cost of a job. Examples might be a limitation, self-imposed, as to the number of bricks that a bricklayer would be allowed to handle in his workday; the requirement of so many carpenters and millwrights to each gang of machinists engaged on a construction job; a prohibition of the use of certain of the modern power driven tools on the job, requiring the work to be accomplished by the slower and more costly hand methods; a requirement that all pipe up to a certain size be bent on the job rather than in a shop well equipped for pipe bending; overtime for a marine fireman when he assists in the necessary and routine blowing of boiler tubes and various other jurisdictional devices which require more trades and time on the job. When your service station installs a complete new set of spark plugs in your car to correct the one that was missing, that is featherbedding in lieu of a stronger word. Pay for time not worked and during which the employee was not even at the site of the job might be listed under this heading. Featherbedding is the brazen art of getting something for nothing; added payments without extra effort, loading the job with excess personnel. Featherbedding is the production of work and a foe to production. Most honest labor leaders, business agents, and workmen deplore the increasing tendency towards featherbedding, but featherbedding is now a well established practice and the technique is being improved daily. It slows down a job, costs the employer more money and, since it is not money earned by the sweat of the brow, is truly good for no one, least of all the ultimate consumer. Even the take-home dollars, by virtue of their having been increased in numbers, tend to shrink in their value. As one trade increases its weekly take, the other trades naturally feel that they, too, must receive more folding money —and demand follows demand.
Then there are the frequent work stoppages. The work stops, but the wages continue in most cases. Many of the stoppages are not due to any quarrel between the employer and the employee; rather they are between two or more of the crafts; jurisdictional disputes as to who will do what, generally very petty in nature but for which each union steward will fight to the limit of the job’s resources. Each union’s rule book states the type of work which must be handled by its craft but, unfortunately, the rule books of the various unions were not written under one supervision and have not been brought into agreement. Perhaps, like the Rules of the Road, they have purposely been left somewhat loose to allow for development. Does an iron worker do this, or is it the job of the boilermaker; should the boilermaker tighten the nut on the bolt, or is it the job of the pipefitter? That sounds picayunish, and is, but it costs the job money. Such practices do not help the value of the dollar in getting a job done.
Today we are advised that increased production is the cure for inflation and for many of our present ills. Surely it seems reasonable that the more we shall be able to coax out of the soil; the more yards of cloth that we may be able to convert from the flower of the cotton; the more milk and butter fat that we can drain from Bossie; and the more homes that we can erect—all these do increase our national wealth in the real needs and comforts of life—provided that they are obtainable, once created. Perhaps some of us may remember when, not so long ago, we were authoritatively advised that it was essential to our well-being that we should not plow or sow the lands and that growing crops and cute little pigs should be plowed under, and it may tend to confuse our thinking. There was a time when increased production led to a lessened cost, but that is not often true today. It is seldom that the increased production of today does come at a lessened labor cost. Artificial props, guaranteed by your tax dollars, hold up the costs of many products. The iron and steel industries claim the greatest production in all of our history, but just you try to buy a hundred feet of two-inch pipe. The Government threatens to go into the steel business if production is not further increased, and business sees a framework for the nationalization of all heavy industry. Production in units or tons is one thing and production per man-day is quite something else. Actually, production per man-day has not increased in many fields; rather it has declined. Talk of a thirty hour workweek gets louder week by week. As seamen we are familiar with the stevedoring industry. It has had the advantage of more and more mechanization; better and better equipment has been provided for the quick and easy handling of loads. The wages of the stevedores are in the upper brackets. Today less tons are being handled per man- day than heretofore, and the trend is towards a compulsory lesser weight load per sling. The stevedoring trade is not outstanding in this respect; our United States flag ships are said to be so costly to operate that there has been served notice that it will be necessary for this Government to send aid to foreign lands in foreign bottoms. We can not afford to pay the freight in ships under American register. The problem is interesting and typical of the times. We may have to send our aid to foreign countries' in foreign bottoms—ships which we have contributed in whole or in part—and we will pay the freight to those nations which we are in the process of aiding while our own ships stand idle. There is logic behind such a decision. Should we continue to send at least half of our gifts in ships under the American flag, at the higher rates involved, we would in effect be subsidizing our own shipping with funds which we have earmarked and promised would be devoted to foreign aid. So long as our ships shall be well employed with demand for men to man the ships and go to sea, just so long will there be demands which will increase the operating charges. If we are to subsidize, it might be well to know just what that subsidy is and not bury it in an aid transaction.
There are always two sides to any story, and this one of inflation and continued increased costs is no exception. While labor, today, is taking full advantage of its newly found power, it is certain that there are forces other than labor at work tending to keep prices up and the value of the dollar down. After some resistance to the increased costs and demands of labor, management has apparently found it to be easier and more convenient just to go along with such increased costs, tacking them onto the selling price together with a little increased overhead and profit for itself. Late experience has proven that labor will get most, if not all, of its demands and that the production of the so-called mediation period is lost. Management will probably be bargained into paying the wages for the non-productive period, thus suffering a double loss. This being an era of a seller’s market, management is apt to be a little greedy to keep its production line moving in order to reap the advantages of that market. True, management has stated its case in the public print, but its case received little publicity and very little consideration. Most people are not particularly interested in the trials and problems of management and are not apt to accept the logic of the economics involved. When they want bread, they want a loaf right then; the question of its production becomes academic. We are likely to question or neglect the fact that management requires that the selling price of its product carry something to replace tools, equipment, and plant facilities so necessary to production but which are daily wearing out and becoming obsolete, all of which will become more expensive to replace. As an example, the S.S. District of Columbia, the popular night boat from Washington to Norfolk, recently was involved in a collision which would have required certain repairs to make her seaworthy. During the investigation as to whether it would be worth while to the Company to repair the vessel for further service, it was stated that the vessel was built in 1925 at a cost of about $800,000, at which time and figure she was the pride of the Potomac. That cost was somewhat above the $200,000 cost of the older vessels, but she was a fine modern vessel, well fitted for a specialized trade. After the collision, it appeared that the cost of repairs might be greater than the original cost of the vessel— and a replacement vessel at today’s cost would be about $3,500,000. Operating costs had advanced to such an extent that her profit to the owners for the year 1947 was less than $6,100. Suffice to say, the night boat to Norfolk is a thing of the past.1
The steel industry recently made a public statement that the cost of facilities had tripled within the past few months. One major oil company has recently stopped work on a large project which it had in hand due to the excessive costs which were developing, cancelling out the preparatory work at a considerable sacrifice. Costs today run into figures reminiscent of the old German Mark and the Russian Ruble. As a nation, we can not seem to think in other than fantastic figures, the new look in finance. Our Federal debt exceeds $252,000,000,000 and the proposed budget for the coming year is in excess of $41,000,000,000, the greatest ever. It is reported that a radio comedian will receive over a million dollars for the shifting of his program from one radio network to another, and that is no laughing matter. Why, $30,000 is awarded for correctly guessing the name of a song! Federal, State, and local politicians are investigating further methods of taxation to implement their platforms of promises. Foreign States, having tasted of our aid, now predict all sorts of dire consequences if we do not continue to expand the flow of goods and dollars. Certain of our Congressmen are predicting national bankruptcy if we do not curtail our spending spree at home and abroad. It surely behooves each of us to give some thought as to where we are heading, what is our limit of capacity as to spending, and what is really best for us as individuals and as the greatest nation on the face of this troubled world.
We are a great Nation; we have become great and powerful due to our wealth of natural resources, our citizenry of a heterogeneous background welded into a homogeneous, tolerant commonwealth of people— and our youth as a Nation. We have grown up to that age where we must, and have, assumed world leadership. Our past wealth of natural resources now shows its limitation and our people have been given a preview of some of the supposed benefits of the socialistic state. Our history indicates that throughout our past there have always been those who cried “Wolf,” fearing that the Nation was bound straight for a Bust. Even lately we have heard the phrase “Boom or Bust” as a battle cry. Thus far each crisis has been but a pause in our further progress. Our policies may not always have been wise, having sometimes been dictated by political expediency. Often our hearts, rather than our minds, have guided our acts. Nevertheless we have come through and grown greater and greater because of that something that is known as American. With diminishing natural resources we shall have to nourish and cherish our American spirit and will to succeed. We must not forget the principles which have made us great.
What are some of the justifications or reasons for today’s high labor costs? He would be brave, indeed, who would try to condense such a broad subject into anything less than volumes. There are trends and set arguments which are well known. Workmen in the building trades have always demanded higher than average wages, it being contended that the building trade was a seasonal occupation. At one time that argument was quite reasonable. Today there is little of a seasonal nature in the construction field, but the precedent has been established and carries over; men in the building trades must be paid a higher hourly wage than the production personnel who will follow them. There is a big backlog of needed construction and, under the closed shop conditions, it is well protected, thus insuring the continued welfare of this group. This huge backlog and the urgent need of certain types of construction lead to a certain amount of overtime work, which increases the weekly take-home dollars. Once the high weekly take-home wage has become established it is difficult to drop back to the average weekly scale. When it happens on any particular job, that job becomes unpopular and is made to pay in one way or another. Thus it is easy to see how high costs come about in this field. First, a high hourly rate is necessary because the work is seasonal; then more than a forty hour week must be worked in order to progress the job and make that particular job attractive, thus establishing an above average weekly take-home wage. The high weekly take-home wage having become established, it becomes quite sacred and must not be lowered—but the hours of work must get back to the forty hour week. The result is a higher hourly rate and the cycle starts once more. With a thirty hour workweek, at of course the same weekly wage as the present forty hour week, will it not be fun; there is so much more margin in which to play.
A somewhat similar situation developed in the nation’s shipbuilding yards during the last war. Many new yards were built at building trades rates, thus more or less establishing weekly wage scales in the various communities. Men were needed to build ships, and the construction gang, right on the ground, was the immediate and available pool. It was not considered reasonable to knock down a man’s standard of living just because he was to build ships rather than the ways on which the ships were to be built, so the building trades rates crept into the shipbuilding industry. Other arguments were offered for the high rates paid in the shipyards, such as to compensate the man for leaving his comfortable old homestead and working in an out-of-the-way shipbuilding yard, a job which would only last for a limited period of time when he would again have to return to his hometown and the lower wage scale. Then there was the dilly wherein it was contended that the high wage scale was necessary so that the workmen could buy more Government bonds to help pay the cost of building ships. That is not a figment of the imagination; the argument was actually offered by a man who was supposed to have good sense.
The pattern of increase upon increase could be traced through the other trades— increases in money, in paid time off the job, retirements and lessened effort requirements, all of which run up the cost of production. As a result, wages have gone up and typical hourly rates now in effect by one concern not noted for being lavish are:
Crane operator |
$1.57 |
Machinist, general |
1.75 |
Utilityman |
1.35 |
Truck driver |
1.30 |
Blacksmith |
1.70 |
Laborer |
1.16 |
with provisions for a certain amount of overtime, group insurance and hospitalization, paid holidays and vacations added.
So much for conditions as they are. They are well known, recognized, and the subject of debate in the Halls of Congress. Everybody is agreed that something must be done to stop spiraling costs and return prices to a more reasonable basis; they are not agreed as to the remedies necessary. Labor claims to have won the last election and thus to have gained the right to dictate what laws shall remain in effect and what methods shall be pursued. Since less than half of the potential voters did vote and the resulting popular vote was close in the case of those who did exercise their option, it is not clear that the American people have really stated their case. Times are still considered “Good,” and each and every one of us has hopes that things will not get completely out of hand, that our natural good sense will come to our rescue. Everyone appears to be reasonably happy while the merry-go-round continues to turn, but there will be a scramble when it stops.
With respect to our own personal problems, what should be our course? Shall we hope that we, too, will receive a boost in pay and hope that the increase will solve our problems for the time? That appears to be the modern trend—to seek a pay increase and continue paying the freight until the rates become so stiff that another raise is necessary. That may not be a wise policy. Would it be wise to start and continue blood transfusions without attempting to close the bleeding wounds? It is probable that with some of the lesions closed there would be less need of pumping in new blood. It is also reasonable to believe that were a policy adopted of holding costs from climbing higher and higher, be it due to high labor costs, high profits, excessive advertising, wasteful management, excessive salaries to high executives or for any other reason, and of allowing the old law of supply and demand to function, of paying to each as he shall merit through his production instead of just circulating more and more money, that we might regain our economic well-being.
We are competing in a world wherein Democracy is on trial. Communism delights in havoc and, despite its protestations, is a foe to anything democratic in principle. We must continue to exercise our right of free thinking, our duty in electing those who shall serve us and our privilege in being Americans. We must remain strong in our faith, determination, and in our dollar value. Our dollars must be our servants at home and our respected emissaries abroad. We must set our own house in order, and that can not be accomplished by allowing the dollar cost of our goods and services to spiral ever upwards. We can not afford to put our dependence on more and more printed dollars not backed up by real value.
The opinions or assertions contained herein are the private ones of the writer and are not to be construed as official or reflecting the views of the Navy Department or naval service at large.
1. This article was written in early 1949. Some conditions have changed, but few for the better. The District of Columbia.