On November 30, 1932, the American Federation of Labor endorsed federal unemployment insurance. This was a remarkable shift for the AFL, which had long opposed any sort of government programs for workers, preferring to rely on voluntarism and negotiation to force employers to concede worker rights instead of a government which it felt it had no reason to trust. This began the broader shift toward the American labor movement relying on government as the guarantor of its rights and the rights of working people writ large.
From its beginning, the AFL distrusted government. In some ways, there were good reasons for this mistrust. American labor history was full of government intervening in labor struggles to provide strikebreaking troops for industry. Why would the labor movement trust it? On the other hand, this mistrust was more than just experiential. It was also ideological for a labor movement extremely hostile to even moderate change in American economic life, not to mention the radicalism pushing for widescale transformations. In 1916, AFL president Samuel Gompers testified before the House Labor Committee against unemployment insurance, calling it “socialist,” which for Gompers was the ultimate insult.
But the AFL severely underestimated the impact of the Great Depression. It largely supported Hoover’s policies in the Depression’s first years and assumed government had no place in regulating industry. But this position placed the AFL squarely in the sights of the left, as well as growing number of liberal writers who openly criticized the labor movement for not even seeming to understand the problems affecting American workers. More importantly, grassroots opposition to the AFL’s traditional stance grew within the federation itself. In 1930, the California state AFL unanimously voted to urge AFL leadership to back an unemployment insurance system that would include contributions from employers, workers, and taxpayers. But the AFL leadership remained sharply opposed in 1930. Victor Olander of the Seaman’s Union responded to these demands at the AFL 1930 convention in Boston by asking whether the AFL will “hew to the line in demanding a greater freedom for the working people of America, or whether liberty shall be sacrificed…to enable workers to obtain a small measure of unemployment relief under government supervision and control.” Moreover, he felt that unemployment insurance would undermine the workers’ movement, arguing it would “prevent the workers from joining in movements to increase wages and improve working conditions because of fears that they might thus sacrifice their eligibility to unemployment insurance.”
Others rejected these fears as ridiculous. Max Zaritsky of the Cap Makers Union noted that workers could not eat the AFL’s rugged individualism and reminded the federation that the nation’s workers were looking to it for leadership in the greatest economic crisis in the nation’s history. But AFL president William Green strongly opposed unemployment insurance and the resolution was defeated.
However, as the economy did not improve, the demands for federal intervention grew. The big shift was the Teamsters coming around to supporting it in a February 1931 article in the International Teamster that attacked the AFL position. The 1931 convention saw real gains for interventionists thanks to the Teamsters and shifting opinion within the United Mine Workers. Unemployment insurance was defeated again in 1931, but the winter of 1932 destroyed the voluntarist side of the labor movement. Union leaders could no longer explain to millions of unemployed workers, including their own members, that they opposed unemployment insurance for abstract reasons. Interestingly, even employers were approaching the AFL saying something needed be done, with General Electric’s Gerald Swope meeting with William Green to support an unemployment compensation system that would include employee contributions instead of the employer-only contributions industry feared. Yet even here, Green remained to the right of industry. But by April 1932, Green read the cards and knew he had to change his position. In 1932, the AFL Executive Council met in Atlantic City and passed a resolution to create a pro-unemployment insurance policy that ensured federal rather than state control and that would safeguard workers’ rights to maintain union membership.
At this point, Green did not drag his feet but rather consulted experts around the country about adopting a moderate proposal. Green’s proposal was submitted to the 1932 AFL Convention on November 21, 1932. At this point, there were 11 million Americans out of work. The final proposal wanted a federal system but also supplemental state systems. Private insurance companies would play no role. The rump of voluntarist leaders continued to fight the proposal, but with Green’s support, its passage was assured and it did pass on November 30.
It’s hard to overestimate what a titanic shift this was within the American Federation of Labor and its importance for the overall trajectory of American labor. Radicals had long accused the AFL of not actually understanding the conditions of work that most American labor faced and ignoring the needs of the majority of those workers. That was an accurate accusation against an organization that clung to notions of independent, skilled labor of Anglo-Saxon men forged in the late 19th century and that were pretty out of date even then. The AFL’s history had consisted of jealously guarding its victories without using them to spread hope or organize other workers. It saw all other labor organizations or plans to help workers as threats that needed eradication, even if it had no actual plans to do anything for those unorganized workers. It’s hardly surprising then that the AFL could not effectively respond to the Great Depression for three years. Only the extreme conditions of that crisis began moving the AFL off its traditional positions. And while internal strife could be overcome on the issue of voluntarism, it could not over organizing labor on an industrial basis and it would require the John L. Lewis and the CIO splitting off from the AFL to finally get it interested in organizing the masses of American labor.
The federal government would implement the first national unemployment insurance program in the Social Security Act of 1935.
Much of this post is borrowed from Irving Bernstein’s classic 1960 tome of the American labor movement, The Lean Years: A History of the American Worker, 1920-1933.
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