However, three big strikes in 1934 were to alter the course of American labour history: the Toledo Electric Auto Lite, Minneapolis truck drivers, and the San Francisco General Strikes. These battles set alight the trade union explosion of the 1930s.
Typically, the old-time craft union leaders of the American Federation of Labour (AFL) repeatedly worked to undermine these strike movements. By late 1935, militants within the AFL established a new caucus known as the Congress of Industrial Organisations (CIO) to fight for industrial unionism under the leadership of the miners’ leader, John L. Lewis. The bureaucrats of the AFL, who ruthlessly opposed all militant action, eventually expelled the CIO from its ranks. Despite this, the CIO took on the role of organising the unorganised mass production industries. The new unions grew enormously in the battles that opened up, which also coincided with the economic revival from June 1935 onwards. In its first 22 months of existence, the CIO grew in strength to embrace a massive 3,700,000 workers, and in terms of members overtook the old AFL.
The strike wave reached new heights in the form of militant sit-ins and occupations. Between September 1936 and June 1937, an unprecedented 484,711 factory occupations took place. Out of the 1,000 reported in the press, the police and state militias only succeeded in breaking 25 sit-in strikes, which revealed the iron determination of the working class. It also demonstrated the colossal sweep of the industrial movement in the United States, drawing in its wake millions of formerly unorganised workers.
This unionisation and strike wave in the United States had important repercussions in the consciousness of the American working class. For instance, workers began to challenge the capitalist parties of Democrat and Republican, and gave rise to the idea of a mass labour party.
“The unprecedented wave of sit-down strikes and the amazingly rapid growth of industrial unionism in the United States (the CIO)”, noted Trotsky in 1938, “is the most indisputable expression of the instinctive striving of the American workers to raise themselves to the level of the tasks imposed upon them by history… Every sit-down strike poses in a practical manner the question of who is boss of the factory, the capitalist or the worker.”
By comparison, the industrial situation in Britain remained at rock bottom. While there was a partial revival after 1934, it was certainly not to the same degree, or to reach the same heights, as in the United States. However, one of the important consequences of the 1926 defeat in Britain was a turn of the working class towards the political front. The general election of 1929 saw a sharp rise in the Labour vote to 8,362,394 and the election of 289 Labour Members of Parliament. This success resulted in the coming to power of the second Labour government in May of that year. It was, however, once again a minority government, led by Ramsay MacDonald, and relied on the votes of the Liberal Party, as in 1924, for its working majority in the Commons. Given this situation, where Labour was again in hock to the Liberals, a heated debate took place within the ranks of the Labour movement over what should be done. Opposition to a bloc with the Liberals came, in particular, from the leftward-moving ILP. Oswald Mosley, who at this time was on the left of the party, articulated the old ILP strategy of no Lib-Lab deals. He advocated that the Labour government throw down the gauntlet to the Opposition parties by putting forward its full socialist programme, and inviting them to vote against. “If it must die let it be, not like an old woman in a bed, but like a man in the field”, was the common refrain. Indeed, the ensuing political crisis should not be regarded as a menace to the Labour movement; on the contrary, it should be the supreme opportunity to go to the country and win an outright majority. Instead MacDonald rejected this “impractical” alternative as a fool’s paradise and eagerly climbed into bed with the Liberals.
After the initial “honeymoon period”, the Labour administration was caught up in the world economic collapse after October 1929, which was to have dramatic consequences for its future. This deep crisis of capitalism shook the Labour government to its very foundations. The ruling class, determined to place the burden of the crisis on the shoulders of the working class, began to exert enormous pressure on the MacDonald government to abandon its reforms and carry out measures to balance the budget. In the words of Cole and Postgate: “The British capitalists wanted a government in which they could feel full confidence – confidence that it would put first and foremost the interests of capitalism, which they of course identified in their own minds with the interests of the country.”[1] Of course, MacDonald, being a faithful servant, tried his best to loyally accommodate this request.
With the world slump, mass unemployment in Britain rose to record levels. In December 1930, the unemployment figures had risen to 2,500,000. By June 1931, unemployment had reached 2,700,000; a month later it was up another 100,000. The capitalist press, led by the main capitalist mouthpiece, The Times, began to orchestrate a campaign for the replacement of the Labour government with an all-party National government. The crisis, they said, was a time to drop party differences and for the “best brains” of all parties to come together for the good of the country and the “national interest”.
To balance the worsening budget, Phillip Snowden, the right-wing Labour chancellor, demanded orthodox deflationary policies embracing deep cuts (“economies”) in public expenditure. In February, the May Committee, under Sir George May, was established to look at savings and recommend a package of cuts to the government. Arising from this, “consultations” took place both with the TUC, the industrialists and the bankers. The TUC opposed the “economies”, but put forward no alternative. Big business demanded even greater cuts in public spending as a solution. As expected, the May Committee backed the City and recommended stringent attacks, including tax increases, cuts in unemployment benefits and the imposition of a Means Test. These draconian measures resulted in large-scale opposition within the trade unions and the ranks of the Labour Party. As expected, Beatrice Webb wrote in her Diary: “The General Council are pigs, they won’t agree to any cuts of Unemployment Insurance Benefits or salaries or wages.”
Under the pressure of big business, MacDonald and a majority of the Labour Cabinet capitulated to the bankers and the City of London and agreed to the “economies”. In August, the Cabinet reluctantly accepted a package of cuts worth £56 million to balance the budget, but baulked at cutting the dole for the unemployed. Not satisfied, an additional £25-30 million was demanded by the bankers to “restore confidence”. This included measures to reduce unemployment benefit by 10 per cent, as well as cuts in the wages of the armed services, teachers and the police, together with other miscellaneous economies.
This extra measure stuck in their throats like a fish bone. The Labour Party had long adopted the slogan “work or full maintenance”, but all that was now to be sacrificed for the sake of saving capitalism. The TUC finally stuck in its heels against the cuts. “Nothing gives me greater regret than to disagree with old industrial friends”, MacDonald told the General Council, “but I really personally find it absolutely impossible to overlook dread realities, as I am afraid you are doing.”[2] Under intense pressure from the Labour movement, a minority in the Cabinet came out against MacDonald and these extra “economies”. They had swallowed a camel, but were straining at a gnat!
This opposition caused complete paralysis in the Labour Cabinet. Soon after this fateful meeting, MacDonald wrote of those who had opposed the extra cuts, accusing them of taking “the easy path of irresponsibility”. It was uncannily echoed some 70 years later by Tony Blair’s denunciation of all those in the Parliamentary Labour Party who opposed his public sector “reforms”.
The Cabinet split caused a constitutional crisis and on 23 August 1931 matters came to a head. It was the end of the road for the Labour government. Without warning, MacDonald set off for Buckingham Palace to inform the King of the situation and offer his resignation. At the Palace, he urged the King to send for the leaders of the official opposition parties to discuss measures in the “national interest”. As had been repeatedly made clear in the editorials of the “quality” press, the ruling class wanted a strong government to carry through the necessary attacks on the working class. The Labour government had introduced cuts, but given the pressure from below, had stalled and as a consequence was now unreliable from the point of view of big business. Sir Herbert Samuel, a far-sighted and astute bourgeois representative, met the King and outlined the case for a National government:
“in view of the fact that the necessary economies would prove most unpalatable to the working classes, it would be to the general interest if they could be imposed by a Labour government. The best solution would be if Mr Ramsay MacDonald, either with his present, or with a reconstituted Labour Cabinet, could propose the economies required. If he failed to secure the support of a sufficient number of his colleagues, then the best alternative would be a National government composed of members of the three parties. It would be preferable that Mr MacDonald should remain Prime Minister in such a National government.”[3]
How cynical these bourgeois strategists can be! Yet at least they did not mince their words and were absolutely clear in their intentions. They knew exactly where their class loyalties lay. The same could not be said of the so-called Labour leaders, who had one foot in the camp of the working class and one foot in the camp of the bourgeoisie.
After consultations, Samuel had his way. MacDonald decided to openly break with the Labour movement. He resigned as Labour prime minister and accepted an offer by the King to set up a National government with Tory and Liberal support. This new government would include those who had crossed the floor with MacDonald, the Labour renegades Snowden, Jimmy Thomas, and Lord Sankey. Stanley Baldwin, the Tory leader, was given the role of vice-premier in the National Government. As expected, this open betrayal by MacDonald, which completely disorientated the labour movement, resulted in a massive defeat for the Labour Party in the ensuing 1931 General Election. The combined bloc of “National” Labour, Tory and National Liberal parties gave them a total vote of 14,500,000 compared to Labour’s 6,648,000 – which under the circumstances, still represented a respectable hard core support. The Parliamentary Labour Party was consequently reduced to a rump of 52 MPs. The crisis had also split the Liberal Party, with the cunning Lloyd George remaining outside of the National Government hoping to capitalise on any future disillusionment.