tility. So also did the Tobacco Workers' International Union, which stated, as the fourth of the objects for which it was organized: "To fight the trust and all trust-made tobacco." In many cases the trusts assumed an equally hostile attitude toward trade unions. In the original deed of the sugar trust, there is mentioned, as the third of its objects: "To furnish protection against unlawful combinations of labor." 3 With the progress of time, however, it has been found that the displacement of workmen by the trusts has gradually ceased; and the attitude of the trade unions has become less hostile. In the conference on trusts held at Chicago, in 1899, those most favorable to the new development (next to the spokesmen of the trusts) were the theoretical economists and certain of the representatives of organized labor. The prevalent attitude of the latter may be illustrated by the following extracts from a speech by Mr. Henry White, the general secretary of the United Garment Workers of America: In America competition has reached a pitch of intensity unknown anywhere else. . . . Instances can be cited where production has been carried on in some large industries at practically no profit, simply with the hope that conditions would improve and because of the inability to withdraw invested capital. Against such destructive warfare combination has come as a relief. . . . In the clothing trades free competition of a certain kind has reached its last ditch and any change would be gladly welcomed as a relief." Mr. Samuel Gompers, president of the American Federation of Labor, spoke of the "legitimate development and natural concentration of industry." On the other hand some of the trusts have deliberately favored union labor, while others have retained their old attitude of an 1 Industrial Commission, vol. 7, p. 441; and The Trust, Its Book (Bridge, Editor), p. 204. 2 Industrial Commission, vol. 17, p. 332. tagonism. This makes it difficult to draw any definite conclusion concerning the relations of trade unions and trusts. The final report of the Industrial Commission shows that its members can find no clue to guide them in the matter, for this report declares: It is impossible to make any statement that will be of universal application regarding the attitude of combinations towards trade unions. In most cases the position taken seems chiefly a matter of personal preference, or it may have been brought to the combination by the experience of some of the establishments which form it.1 The object of the present paper is to set forth certain facts which may throw light on this complex situation, and which perhaps warrant more definite conclusions concerning the mutual relations of trusts and trade unions. I. It is often assumed that the growth of trusts has stimulated the growth of trade unions; but inquiry will show that it is hardly possible to point to a single instance where the rise of the trust has been followed by a combination of the workmen employed in the industry affected. As will be noted later, an existing trade union has sometimes been enabled to strengthen itself through an alliance with a trust, but the writer is unaware of a single case where a combination of capital has provoked permanent and successful union among the work people. The reverse order of events, however, is not uncommon. The introduction of largescale production indeed tends to the growth of trade unions, for in their absence the single workman is at a serious strategic disadvantage in bargaining with the employer; but when the union has been formed the strategic disadvantage is transferred to the employer. He is faced by a compact body of trade unionists 1 Industrial Commission, vol. 19, p. 622. 2 Possibly the Tobacco Workers' International Union is an exception, but even it is by no means to be described as successful, as it includes only five or six per cent of the workers. Ibid., vol. 7, p. 192 of digest. who assert that other establishments in the trade are giving higher wages or better conditions than his factory, and that he must bring his establishment into line. The possibility of being forced into this position is of course the reason why the employer, while often willing to treat with a committee of his own workmen, usually refuses to negotiate with the officers of their national or international union. He realizes that if once he meets the officials of an organization which has branches throughout the whole country, which has command of information concerning the conditions of trade and labor in every centre of industry, and which is sufficiently well disciplined to act in concert in obedience to any line of policy that may be agreed upon, then he, and not the workmen, will be the weaker party in the driving of a bargain. The employers therefore federate in their turn; and thus, in the end, are brought face to face the consolidated forces of labor and of capital, organized on each side and meeting at regular intervals to draw up agreements regulating wages, hours and conditions of work. This system is now very generally adopted in the staple industries of Great Britain. In America the system of collective bargaining and of annual agreements regulating the whole of the relations between employers and work people in a particular trade is less widespread, but it is growing in favor. Already in the bituminous coal regions, formerly in the anthracite districts,3 to some extent in the iron, steel and tin industries,* in the stove-foundry trade (one of the most effective systems), and in the glass trades, wages are fixed by joint boards representing the majority of workers and employers in the industries affected. In precisely the trades mentioned above there now exist or have existed trusts, e.g. the Pittsburg Coal Company,' the combination of anthracite operators, the United States Steel Corporation with its subordinate companies, the window-glass and flint-glass trusts. Even more direct evidence than this mere coincidence can be adduced. Mr. Roberts, in his recent book on the anthracite coal industry, points 2 1 Webbs, Industrial Democracy. Ibid., vol. 17, p. 327. Ibid., vol. 17, p. 347. 2 Industrial Commission, vol. 17, p. 326. Ibid., vol. 17, p. 339. • Ibid., vol. 17, p. 361. 7 This combine was not, however, successful in establishing the monopolistic power it had hoped for. out how the rise of the trade unions stimulates combination among the capitalists.1 And in the stove foundry trade there exists, alongside of the organization dealing with relations with employees, another association dealing altogether with the commercial side of the business, and to a large extent officered by the same men.2 While these facts are by no means conclusive, there seems at least to be more reason for holding that trade unions have fostered the growth of trusts than that trusts have fostered trade unions. But the existence of trade unions is, of course, only a contributory or minor cause in the development of the trusts. II. If it be granted that trusts do not as a general rule cause the growth of trade unions, there still remains the question as to their effect on the workmen's organizations and on the position of the employees generally. It is perfectly evident that the Lexow Trust Commission of 1897 believed that the trusts were a dangerous menace to the workingman. In its report is to be found the following passage: Another advantage is alleged to be that of better wages and more constant employment. We are unable to reach this conclusion. No part of the profit arising from admitted economies and resulting in large dividends on inflated stocks has reached labor in the form of higher wages, while the claim of constancy of employment is negatived by the fact that factories in operation for a generation have been closed and that workingmen, more or less continually employed for years in a factory independently operated, have been discharged on its absorption by the combination. 3 This passage was written in 1897. Three years later the situation was so far changed that we find the glass trust (The National Glass Company) deliberately unionizing all the establishments 1 The Anthracite Coal Industry, pp. 69, 70, 78. • Industrial Commission, vol. 7, pp. 860, 867. Investigation of Trusts, N.Y. Senate Documents, 1897, no. 40, p. 17. under its control,1 and Mr. Schaffer, the president of the Amalgamated Association of Iron, Steel and Tin Workers, expressing an opinion decidedly favorable to trusts. It appears, then, that caution is necessary in drawing conclusions from the conditions obtaining at any given moment. Caution is further required because of the difficulty of obtaining exact information.3 With these warnings to the reader, the writer takes up, first, the cases where a noticeable friendliness prevails between the two organizations. The case of the flint-glass trust, referred to above, is one of the most remarkable. The story of its formation, as told in the report of the Industrial Commission, presents many of the familiar features of reckless over-production, fierce competition and absence of profits or even positive loss on the capital invested. In 1899 the question of a combination was discussed and arrangements were made for the merging of nineteen concerns into a single corporation to be entitled the National Glass Company. Its method of organization differed in several respects from that of most trusts; it seems indeed to be nearer akin to a German cartell than to an orthodox American combine, and it was not formed by a promoter, but by a committee of manufacturers. There was no over-capitalization, and no complete centralization of management. But for our present purpose the most interesting point about the flint-glass trust is its attitude toward that 1 Industrial Commission, vol. 7, p. 831. 2 Ibid., vol. 7, p. 395. The facts set forth in this paper are derived mainly from the evidence taken before the Industrial Commission, but that body did not direct any special attention to this matter, and not infrequently the evidence of the witnesses stops precisely at the point where for our purpose further light is most needed. A theoretical economist who is not in direct and immediate touch with the business world may easily be misled by such partial and incomplete information as can be gathered from government reports, commercial and trade-union journals, and occasional conversations with business men. • Industrial Commission, vol. 7, pp. 896 et seq. For a discussion of the differences between trusts and cartells, see Aschrott, Die amerikanischen Trusts (Tübingen, 1889); de Rousiers, Les Syndicats industriels de producteurs (Paris, 1901), p. 119; Grunzell, Über Kartelle (Leipzig, • Industrial Commission, vol. 7, p. 829. |