I’m not a big Henry Ford fan. Too Progressive for my tastes, but he was right about the unions. Ford was adamantly against labor unions. He believed in increasing productivity. Ford also believed that union leaders had a perverse incentive to foment perpetual socioeconomic crisis as a way to maintain their own power. Meanwhile, he believed that smart managers had an incentive to do right by their workers, because doing so would maximize their own profits. Ford did acknowledge, however, that many managers were basically too bad at managing to understand this fact. But Ford believed that eventually, if good managers such as himself could fend off the attacks of misguided people from both the left and the right (i.e., both socialists and bad-manager reactionaries), the good managers would create a socioeconomic system wherein neither bad management nor bad unions could find enough support to continue existing. He did not win his battle. After a long and bitter struggle on the part of Henry Ford against cooperation with organized labor unions, Ford Motor Company signed its first contract with the United Automobile Workers of America and Congress of Industrial Organizations (UAW-CIO) in 1941.
From The Federalist Papers Project:
Capitalism is what works. Labor unions don’t!
On this day in 1926, Ford Motor Company becomes one of the first companies in America to adopt a five-day, 40-hour week for workers in its automotive factories. The policy would be extended to Ford’s office workers the following August.
Henry Ford’s Detroit-based automobile company had broken ground in its labor policies before. In early 1914, against a backdrop of widespread unemployment and increasing labor unrest, Ford announced that it would pay its male factory workers a minimum wage of $5 per eight-hour day, upped from a previous rate of $2.34 for nine hours (the policy was adopted for female workers in 1916). The news shocked many in the industry–at the time, $5 per day was nearly double what the average auto worker made–but turned out to be a stroke of brilliance, immediately boosting productivity along the assembly line and building a sense of company loyalty and pride among Ford’s workers.
The decision to reduce the workweek from six to five days had originally been made in 1922. According to an article published in The New York Times that March, Edsel Ford, Henry’s son and the company’s president, explained that “Every man needs more than one day a week for rest and recreation….The Ford Company always has sought to promote [an] ideal home life for its employees. We believe that in order to live properly every man should have more time to spend with his family.”
Henry Ford said of the decision: “It is high time to rid ourselves of the notion that leisure for workmen is either ‘lost time’ or a class privilege.” At Ford’s own admission, however, the five-day workweek was also instituted in order to increase productivity: Though workers’ time on the job had decreased, they were expected to expend more effort while they were there. Manufacturers all over the country, and the world, soon followed Ford’s lead, and the Monday-to-Friday workweek became standard practice.
Unions at one time had a place in America. They did help ensure higher wages and better working conditions. In the middle ’90s that changed. Circa 1994, AFSCME president Gerald McEntee approached the AFL-CIO with his idea for Project ’95, a coalition effort aimed at retaking the House, for the Democratic Party, but AFL-CIO President Lane Kirkland demurred. With that, McEntee and fellow Democratic Socialists of America supporter John Sweeney began canvassing their colleagues about Kirkland’s removal. In short order, they amassed support from a coalition that included not just the core of the old CIO (the Auto Workers, Steelworkers, Mine Workers), but the Machinists, Ron Carey’s new-model Teamsters, the Carpenters and the Laborers. What began as dissatisfaction among top labor leaders with the Big Sleep of the Kirkland era evolved in the course of the year to the most profound move to the left since the founding of the CIO. Sweeney formally joined DSA and assumed the presidency of the U.S.’ largest labor federation. Socialists and communists were welcomed into the unions once more. Capitalism still works and unions are now un-American. Let businesses like Henry Ford’s dictate their own policies – they should not allow unions in to insert communist and thuggish influence.