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The Second Annual Catholic Congress: Essays and Papers

Milwaukee, Wisconsin, October 12, 13, 14, 1926

New York: The Catholic Congress Committee, 1926.

Transcribed by Wayne Kempton
Archivist and Historiographer of the Diocese of New York, 2011

[107] The Catholic Religion and Industrial Relations
President of the Metropolitan Insurance Company, New York

THE purpose of this paper is to present from a Christian point of view the present situation of the industrial problem.

The social problem, that concerns the relations of different classes to each other, is one which exercises the thought and activity of the Church and the world; and that part of it which concerns industrial relations is perhaps now the most prominent. There has been for a hundred and fifty years a pretty constant clash between employer and employee, and this is generally described as a contest between Capital and Labor.

We have passed through a period of great unrest and many conflicts involving strikes, riots and serious disagreements between employer and employee; indeed, one of the most serious conflicts is now going on in England in the mining industry. They have a historical basis. The story of the last one hundred and fifty years is one of exploitation of the laboring classes and their revolt. I think it is the general impression that these troubles date from the introduction of machinery and have been incidental mainly to manufacturing business where enormous [107/108] profits have been accumulated by the companies and where labor has been underpaid and ill-used. But the matter goes further back than that. I do not know a sadder picture than the condition of agricultural labor in England in the latter part of the eighteenth century. Employers and Government joined to keep Labor in subjection and they made no secret of it. Low wages were considered necessary as a means of compulsion to work, The farm laborers were paid 1s. 6d. per day. A family with five children were paid 8s. 6d. a week, when the cost of maintenance was 11s. 71/2d. The deficit was covered by Poor Law Relief and the imposed necessity of the work of wife and children in other employments. An Elizabethan Statute fixed a scale of proper wages. If the employer paid more he was fined £5 and sentenced to ten days in jail. Any laborer who received more was sent to jail for twenty-one days. The daily fare was fit only for animals; the housing was in one or two rooms, and often cattle were stored at the end of the house. There were holes in the ceiling and walls for chimney and windows.

When manufacturing expanded in the last half of the century, there was first the putting-out system where work was given out by merchants and petty manufacturers. Women of all ages were seen everywhere walking from place to place busily knitting. Agricultural workers were expected to eke out an existence by spinning and were denied a subsistence wage because they were expected to exist primarily by agriculture. The Society for Bettering the Condition of the Poor looked with satisfaction upon bringing up children half naked and indifferently fed, because they made hardier and better laborers. The introduction of machinery and factory labor did not better matters. A patent was granted for a new spinning machine, the chief claim for it being that a child of three or four years of age might do as much as one of seven or [108/109] eight. The factory houses were hovels. A writer in 1788 wrote that "the arts and manufacturers can exhibit as mournful a scene of blinded and lame, enfeebled, decrepit, asthmatic, consumptive wretches panting for breath and crawling, half alive, upon the surface of the earth."

The turn of the tide came when in factory towns the laborers were brought into contact with each other and there was naturally a movement among them to combine in order to bring about better conditions. Employers became alarmed and legislation was obtained to prevent combinations among workers. The common law and the statutes were enforced with increasing rigor and often with relentless cruelty. It is interesting that a way out for the laborers was made by the progenitor of Industrial Insurance. The workmen were allowed and even encouraged to form friendly societies for the purpose of creating funds by specified contributions of members for providing some form of insurance against sickness and other misfortunes. They were originally called Box Clubs, because at the meetings of the men, usually in public houses, the contributions were put into and kept in boxes. These clubs multiplied and there was, naturally, a tendency among the members to engage in mutinous disputes with their employers. Out of them grew trade unions, and in 1824 a Committee of Investigation reported on the widespread utilization of friendly societies for trade union purposes. And they were strong enough in that year to bring about the repeal of the Combination Acts of 1799-1800.

This historical review is necessary to enable one to understand the history of the last century resulting from the growth and increasing power of trade unionism. The extension of suffrage in England and the free suffrage in the United States largely account for this great increase. In England the Unions have formed a Labor [109/110] party, which once actually obtained the Government. In this country, although I have never known of more than one or two cases where the wage-earners voted as a party, yet the political parties are always angling for the labor vote, and perhaps this is just as effective as the formation of a separate party. The exercise of this power has, of course, resulted in much remedial legislation, such as the Workmen's Compensation Acts. But it has done more. The succession of conflicts brought about by the Unions has put the case of the worker before the public. The tremendous increase in newspaper circulation has enabled the workingmen to get their case presented.

There are abundant evidences of a change of spirit on the part of employers. There is a swift movement towards co-operation and mutual understanding, especially among manufacturers. There is recognition of mutual dependence.

Take one instance—Group insurance. This is the insurance of bodies of workers under one employer. The premiums are paid in part by employer, in part by employee. Both are insured by the same contract and both participate in the cost. The employee realizes that his employer cares for his welfare and that of his family. The employer realizes that to get the best results he must have a force of men who look upon him as a friend. There are nearly five billions of dollars in Group insurance now in force covering four and a half millions of workers. A billion dollars of insurance was written in 1925. Life insurance in America shows prodigious totals. There are about eighty billions of dollars in force covering fifty-eight millions of people and the money spent for insurance is three billions of dollars annually. Of the insurance in force, fourteen billions are in Industrial insurance covering forty million lives. Industrial insurance is the insurance of wage earners who pay premiums [110/111] weekly to collectors. The system has popularized life insurance and led to Group insurance. The large Industrial companies engage in welfare and health work with the wage earners. One company gives free nursing to the sick, and systematically distributes to the families health literature. It has extended this to Group insurance; so that we find the wage earners whose employers have joined in the cost of their insurance are nursed when sick, and receive literature aimed at prevention and cure of illness. And Group insurance is not only against death, but the companies insure the workmen for sick benefits and against accidents. In addition to all of this, corporations are more and more coming to a system of pensions, by which, on disability or the attainment of an age calling for retirement, their employees receive monthly payments of pensions.

Signs multiply that better relations are coming in other ways than from financial benefits. Employers are studying the subjects of good management, the creation of good morale, co-operation in management and even co-partnership by stock ownership by employees. In railroads, 250,000 shopmen belonging to their unions have endorsed trade-union co-operation with the officials. The President of the American Federation of Labor has announced that Labor is willing to make its contribution to assist management to bring about the right solution of problems such as "regularization of employment, fluctuation in prices, standardization of output, healthful and sanitary conditions of employment and the problems of unemployment and safety."

Ramifications of these co-operative plans have included the application of the Golden Rule to management and men jointly; the formation of bi-partisan committees to govern the work, adjust wages and revise rules and working conditions; on the men's part a promise to produce [111/112] more and show a greater interest in the company's welfare in return for a voice in the labor policies and a greater security of employment in hard times. There is much study among employers to so run their manufacturing business and their railroad business as to decrease if not eliminate seasonal unemployment. There is a widespread movement for shorter hours of labor and the granting of vacations. Rest rooms, rest periods, medical care, including optical and dental treatment, occupational disease control, physical examination, accident prevention, social organizations in the plants, amusements, conditions of comfort while at work, ventilation, lighting, general environment, humidity, heat, elimination of dust, drinking water, lunch rooms (there are 4,200 of these), lunches free or at low cost, nursing, instruction in hygiene, housing, draining, credit unions for building, building loan associations, mutual benefit associations, thrift systems. It is very common to have personnel officers in charge of these matters.

Some of the greatest corporations in the country are encouraging and helping employees to purchase shares of the capital stock. Over four and a quarter millions of shares, valued at four million five hundred and fifty-five thousand dollars, are held by 315,497 employees in twenty-five companies, and the total holding of employees in corporate stock is estimated at over seven hundred millions of dollars. Profit-sharing is also coming into practice—either profit-sharing with all eligible employees, or with those who have bought stock (who get advantages over the ordinary stockholder by receiving extra profits before the declaration of dividends) or with employees who participate in a company's savings plan, which is a fund made up of joint contributions by employer and employee.

[113] We have seen the condition of labor improving in matter of compensation and no doubt this has been the work of the trade unions. But we have seen signs of better relations between employer and employees. This generation is indeed witnessing a different outlook by owners of capital and to some extent by workers. The head of one of the leading banking houses of this country, known throughout the world, and himself a member of our Communion, has written a brilliant essay on the life of one who embodied in his day in the eye of the public all the qualities of what the public calls a Predatory Capitalist and who made an enormous fortune. The essayist insists that in the main his friend was misunderstood and misjudged; but in one case where public prejudice was particularly aroused our essayist says of the scheme that "it was planned and carried out in accordance with the then prevailing laws and usages, following a formula which was not at that time regarded as open to criticism." In other words, each period of time has its own standard of morals. Our author discusses the new and modern view of corporate and personal power and possession: "The undisturbed possession of the material rewards now given to success, because success presupposes service, can be perpetuated only if its beneficiaries exercise moderation, self-restraint and consideration for others in the use of their opportunities, and if their ability is exerted not merely for their own advantage, but also for the public good and the weal of their fellow-men." So far Capital. Now hear Labor represented by an address by Mr. Green, President of the American Federation of Labor: "The employers and employees owe it to themselves, to all who are dependent upon industry, and to our nation, to avoid subterfuges, to accept and engage in collective bargaining, to recognize and respect the rights of each other"; and he pleads for "the maintenance of [113/114] harmonious relations," "through personal association, honest and sincere dealing, through conference and education."

Now this is a new situation. Both sides are calling for mutual understanding and both are expressing the duty of public service. What has caused it? The spectacle of one-sixth of the population banded into a mutual company, nursing sick members by millions of visits and distributing to each other hundreds of millions of health literature, must have had a humanizing and spiritualizing effect not only upon the members but upon business generally; and then the extension of the system by which employers are co-operating with their men to care for each other in sickness and in death and in treating workers as human beings and not as machines, must have effect upon public opinion. But are these things causes or effects?

In our generation there has been an arousing of public conscience. People and especially Christian people and more particularly Catholics have seen and studied the facts. Aroused by the conflicts and the cries of the working people, they have investigated and tried to get at fundamentals. Catholics have been studying how to apply Catholic principles. In England in the eighteenth and most of the nineteenth centuries, Protestantism was the religion of England outside the Church of England and to a large extent inside and it was frankly materialistic. The Church so far as we know stood passive. It was a benevolent Anglican clergyman who in 1785 urged the general adoption of the rule in Rutland, that no person be allowed relief on account of any child above six years of age who should not be able to knit, nor on account of any child above nine years of age who should not be able to spin either linen or wool. Meanwhile, great wealth accumulated, much of it by the exploitation of labor, and [114/115] it was not only unrebuked, but the recipients were the religious people of the time. It is this generation that has witnessed in our own Communion the leadership of Bishop Gore and Scott-Holland and a band of Catholics in declaiming against existing conditions and pleading for social justice, for the rights of workers; the pronouncements of the Lambeth Conferences, and the General Conventions of our own Church and our organizations for social service; and in the Roman Catholic Church the encyclicals of the Popes and the addresses of the American hierarchy. What has caused the tremendous change in public opinion, the awakening of public conscience in respect of industrial relations, except the unceasing and increasing Christian agitation, in which there has been Catholic leadership? The last Anglo-Catholic Congress in England was devoted solely to the rights of Labor in industry and the housing of the workers; and the ringing words of Bishop Weston in closing the previous Congress have become a classic. In the present mining strike in England eight Anglican Bishops led other religious leaders in intervention in a plea for peace.

It is for Catholics to keep up the work of fostering and leading in the work of industrial peace. It is to change and lift up what our author called "the prevailing laws and usages"; to elevate the standards of morals in business. It is well to avoid catch words and slogans. Capitalism has to be defined. There is no use of using the word unless people understand what you mean. It is absurd to expect to carry the work of the world without capital. Then "Socialism." What is it? There is no definition upon which all who profess it are agreed. It is Studdert-Kennedy whom most people I suspect would think to be a Socialist who says Socialism is no more Christian than Capitalism. "Excess profits." What are they in business and industry? Who shall limit the [115/116] rewards of ability, initiative and hard work? What is of importance is the use of them. In industry it seems right and in accordance with religious principles that labor should share with capital in the returns. It seems advisable and in the promotion of industrial peace that there should be some share in management by labor. The law of charity should make employer and employees to be not antagonistic, but in a real sense partners in interest. Unselfishness, self-sacrifice and service—these are the Catholic watchwords. There is nothing in the world that appeals to a man's conscience like service. Ambition fades. The glory of wealth fades. Extent of power fades. What does remain here and throughout eternity is that every man try his best in serving God to serve well his fellow-men. That is the Catholic doctrine to preach and to practice. I was asked in London to contribute to one of the principal literary weeklies an article on "What Is the Matter with the World." I declined. The paper probably wouldn't have published the answer. It is that the world does not practice the Catholic religion in international relations, in business, in industry. That is the religion of love. And that means service. And the Catholic duty is to act it and to do all that is possible by precept to create an atmosphere, a public sentiment for unselfish love of our fellow-men.

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