Paul Mattick

The Babbitts Have a Program

On The Program of the National Association of Manufacturers


Published: in International Council Correspondence Vol. 1, no.4, January 1935, pp 1-4.
Source: Antonie Pannekoek Archives
Transcribed: by Graham Dyer

The spirit of Hoover, Babbitt & Company lives on, very much unimpaired. The Roosevelt Revolution came, passed over it, and finally spent itself in the vaporings characteristic of predepression Cal at his best. The manufacturers, industrialists or whatever one chooses to call them (but the word “capitalists” is taboo) have taken heart, emerged from their cellars and come forward with a “Proposed Platform for Recovery” which we understand was adopted at their annual convention at the Waldorf-Astoria, Dec. 5 and 6. Or if it wasn't adopted, that was a mere oversight due to the fact that the delegates no doubt had a number of more important things to think about, as, for example, the best way to spend the evening.

And if you don't believe that this Platform is a gem, just read the first page introduction by Mr. C.L. Bardo, president, and be convinced. Here we are informed specifically that the worthy Babbitts are intent on “giving their best thought and unity towards business recovery” and that “at this particularly crucial time” the “elements of recovery” are merely awaiting “the materializing effect of stabilizing policies”. Which at any rate seems to prove that the lords of American capital are learning to use bigger words; perhaps they will actually be reading before long - if only the signs of the times. In fact, even the present program contains an occasional note of alarm regarding radical criticism, and a hint at fascist repression. We are warned, for example, to “stop poisoning the wells of public opinion” (as if that were not another capitalist monopoly); and the Committee (of future relations of government to industry) “urges a check upon those utterances that rashly assail the general integrity and competence of our industrial leadership or assert the failure of our economic system”. But even at the risk of injecting a little more poison into those wells, we wish to take up the various proposals of the Platform in order and in some detail.

The first proposal, “subject to ratification by industry”, deals in a general way with “The Road to Recovery”. The keynote here is that “recovery must be ranked first among all relief measures” or “recovery and re-employment must not be subordinated to reform”. And how is recovery to be brought about? After all the talk covering three large pages, it all boils down to the old cliche of “confidence” and the removal of “impediments in the road to recovery”. In other words, the Roosevelt program of action having failed, and capitalism having proved that it is not amenable to reform, back to the do-nothingism of the Great Engineer. The Committee is evidently not altogether unaware of the weakness of its position, and accordingly devotes a couple of paragraphs here to pointing with pride to past accomplishments under the American Constitution and to uttering a warning against some unmentionable malefactors by whom “our people are now being told that our difficulties are due to the breakdown of an outworn economic system”. However, “out of experience in the daily conduct of our business”, the enlightened economists go on to be more specific.

Here we come to the real “Platform for Recovery” which in its extra-large type covers five pages and deals with six different subjects: 1 - National Economic Planning and Public Administration; 2 – Public Finance; 3 - Money, Banking and Private Credit; 4 - Government Competition; 5 - Employment Relations and Industrial Disputes; 6 – Social Security. The whole thing is quite as hidebound in its conservatism and as barren of any idea that would even so much as tend to promote recovery as an editorial by William Randolph Hearst, or a Republican Party platform written, say, by Herbert Hoover. How any set of men with even normal intelligence could seriously put forth such stuff as worthy of consideration in this sixth year of the “depression” is rather a mystery and can perhaps be most satisfactorily explained by the unconscionable demagogy of the bourgeoisie throughout the world. They seem to feel that the radical arguments have to be countered in some manner or other, and that nonsense is better than nothing.

But here are the dreary examples. Economic planning is, of course, rejected, on the long-hackneyed and purely ideological ground that it tends to regimentation, and that “no group of men is wise enough to plan and control the operations of all our manifold business activities”; though this latter statement does at least contain an implied admission that capitalism itself precludes planning, and is perhaps for that reason worthy of being called to the attention of all liberals.

On the question of public finance, the great aim is, of course, to balance the Federal budget - and how? Merely by the “adoption of policies which will stimulate business, restore employment, increase national income and permit cutting public expenses to fit reasonable taxes”. Here, however, the Babbitts are at their best; they make some concrete proposals which might possibly prove somewhat effective - mostly at the expense of the workers and others whose budgets (if any) are rarely or never balanced. These include rejecting payment of the soldiers' bonus until due, federal appropriations for constitutional purposes only (whatever that means) and “an equitable non-cumulative manufacturers' sales tax” to take the place of “existing state sales taxes and present selective Federal sales and ‘nuisance’ taxes”.

Government competition is, of course, a very touchy point with these gentry, and their phraseology on the subject becomes quite ludicrous in its unguarded rage. Thus we are told to “abandon all forms of government competition which as examples threaten industry, thwart private initiative and retard recovery” (italics ours), and again:  “Stop government competition which converts the taxpayer's money into an instrument for his destruction” (!). Demagogy here turns upon and devours itself.

The section on employment relations and industrial disputes is equally rich in what it tries to conceal, though more carefully worded. It contains in miniature the complete open-shop and no-strike philosophy dear to the hearts of all industrialists. They are very solicitous, of course, about strike-breakers (what they call “protecting men in their right to work”), they want the government to prohibit sympathetic or general strikes, they would “refrain from policies which attempt to force men into labor organizations”, and above all, they would not “deprive individuals and minorities of their right to bargain for themselves”, nor, no doubt, of their right to starve. And while “management recognizes that the productivity of the worker should be fairly and even liberally reflected in his compensation”, still, of course, “labor cannot share what is not produced”. We wonder, however, if Labor might not reasonably ask why it is not produced. Would the self-solicitous capitalists be good enough to explain that, or would such an explanation belong among those rash utterances which must be checked?  Or would it simply be to “ignore economic” (U.S. capitalistic) “possibilities”?

The question of “social security” is taken up in more detail in a special proposal farther on in the Platform. It contains nothing of any particular interest, or at least nothing particularly new or unexpected, except perhaps the apparent effrontery of the first sentence which reads: “Both prevention and relief of unemployment are social problems which management, employees and all other social groups must accept their full share of responsibility”. We say “apparent” because it is quite possible that here the industrialists were thinking of the responsibility of these employees and other groups for permitting capitalism to keep on vegetating. In fact, we read on the previous page of the Program about “the normal and orderly method through which a free people in its own interest authorizes its (!) private enterprises to demonstrate by voluntary action their capacity for self-organization, and self-control and self-enforcement of that control in the light of their experiences”. (Very obliging of a free people, to be sure!) Otherwise, the “relief principles” of the industrialists are, as we said, very much what was to be expected in view of the origin. There is the usual talk about “relief so extravagant that it undermines the morale of those who receive it”, and the usual concern with having wage rates for work performed on work relief lower than current wage rates in private employment, and the fear that taxpayers’ money might be used in such a way as to encourage or incite strikes. Finally, it is suggested that “the amount provided for relief should be based on actual individual and family needs and not permitted to become a matter of legal right”, and the C.C.C. is commended as an “example of successful relief work combined with citizenship training”.

The report of the Committee on the Future Relations of Government to Industry is perhaps the most interesting part of the Program, since it reveals the direction in which the industrials think they are headed - mostly backward. Of course the Committee “expresses its faith in the tested fundamentals of our political and economic system” and “recognizes as an essential task of statesmanship the continuing adaptation of these principles to the problems peculiar to modern life without compromise or surrender of the basic truths which they contain”. It assumes that the powers contained in the National Industrial Recovery Act rest upon the assertion of emergency authority and that “it is obvious the emergency will pass”. It looks forward to the “expiry date” of the N.R.A. (June l6, 1935) with considerable relief, whereupon it trusts that its own plan “would provide a means of securing, with a minimum of executive enforcement, the free and effective cooperation of Industry and Government”. This plan consists essentially in the enactment by Congress of a Fair Trade Practice Act which would differ from the N.R.A. primarily in the fact that the adoption of codes of fair practice would be voluntary on the part of the different industries and subject to approval or disapproval by an administrative court. ln fact, the plan would go still farther in the freedom granted to industry, in that “an approved code should likewise place upon the industry the primary obligation of policing enforcement”.

The Program ends with a panegyric to the achievements of American industry, a panegyric which turns out to be a rather lame apologetic. The good industrialists display a real concern about the future of “this great financial, industrial and humanity-serving structure” which to “destroy through prejudice or lack of understanding would be to burn down the house in order to punish some rat”. But the last sentence reveals a chastened and (to the initiated) hopeless outlook which belies all the brave words that went before, as if they had faintly realized that capitalism still drags on merely by inertia and strength of tradition. The best that they can gather up heart to say is that “once artificial obstacles are removed, and confidence restored, industry will do its full part toward recovery”.


Last updated on: 4.3.2016