To the extent that historians have considered the 1950s to be the golden age for the auto industry and for autoworkers, 1955 is most likely the template for that conclusion. The year began with virtually all auto plants operating at or near capacity, with multiple shifts, and with predictions from business leaders that the good times would last indefinitely. Nevertheless, there were still large numbers of unemployed Detroiters, and autoworkers and UAW leaders feared that excessive production early in the year could mean layoffs by fall. While production hummed at record rates, automakers and the UAW engaged in contract negotiations, with union leaders demanding a guaranteed annual wage (GAW), which, if it worked, would result in more regular employment for their members. The GAW was controversial within the union and vilified by the business community. Avoiding strikes while production and employment were at such high levels, the UAW and automakers settled on a compromise, supplemental unemployment benefits (SUB), which addressed to some extent the hardships workers experienced during layoffs. To outside observers, autoworkers now had high wages, pensions, medical benefits, and protection against layoffs, making them among the leading members of what was called the “labor aristocracy” in America. The reality for autoworkers had been quite different, of course, as employment instability had undercut access to the jobs that supposedly provided elite status, and nobody knew yet how well the new SUB system would work. But more than any other year in the decade, 1955 saw high production, low unemployment, record profits for automakers, and the highest payrolls ever for the industry. Only pessimists, it seemed, focused on the large numbers of new cars that went unsold or the credit bubble that appeared to be financing auto purchases. To auto industry boosters, 1955 was more than the best year since World War II. It was “The Best Year in All History.”
* * *
“The automobile industry is in a highly optimistic mood about its own prospects in 1955 and the years beyond,” declared William Cronin of the Automobile Manufacturers Association. “The consensus among economists, government officials and business leaders is that, barring unforeseen disruptions, the bountiful and busy economy of the United States will continue on its upward way for generations.” A. W. Zelomek, president of the International Statistical Bureau, largely agreed, declaring that “1955 will provide American industry with the greatest opportunity of any year in history,” adding that “this applies particularly to the automobile industry.” The key was aggregate purchasing power. Nationwide, Zelomek reported, consumers started the year with “close to 200 billion dollars in liquid assets” that would ignite the economy. With this statistic in mind, he concluded that the 1954 recession had been “little more than an inventory readjustment period.” Automakers produced cars accordingly. After a dismal year, all Chrysler divisions operated on overtime in early 1955. Ford had fared much better in 1954 and hit the ground running in January. GM president Harlow Curtice predicted that his company’s 1955 sales would be “the highest in our history.” Walter Reuther, however, claimed that automakers might have to manufacture “plastic consumers” if they wanted to sell all of the cars they were producing. Anyone predicting that 1955 would be a boom year, he said, must be smoking “king-size marijuana cigarets.” The Free Press editorial staff appreciated the automakers’ optimism far more than the UAW leader’s warnings. “One suspects that short of his own Utopia nothing can look good to Mr. Reuther,” they wrote. “One may suspect, too, that Mr. Reuther feels that until such time as the machinery of government is completely controlled by him and his followers there can be little reason for encouragement.”1
Reuther’s critics had significant evidence on their side. Chrysler’s Plymouth plant highlighted the stark contrast with 1954. Whereas the factory had operated either on a part-time basis or not at all a year earlier, in 1955 it was buzzing with activity inside and out. Two shifts of forty-five hundred workers ran on assembly, and three shifts produced parts to keep the final lines running. Twenty-seven miles of conveyor systems moved materials through the plant, while more than fifteen hundred machine tools stamped, bored, and finished parts. City buses clogged nearby streets at shift changes, and workers parked their cars wherever they could. Trucks and train cars delivered frames from Midland Steel and Budd; bodies from the Mack plant; hoods and fenders from the DeSoto stamping and the Nine-Mile press plants; transmissions from Kokomo, Indiana; tires from Goodyear; cylinder blocks from American Foundry in Indianapolis; and batteries, generators, and ignitions from Electric Auto-Lite in Toledo. Each day trucks and trains hauled away twenty-three hundred new cars along with tons of scrap steel. The plant consumed over 165,000 kilowatts of electricity daily and a million cubic feet of natural gas. Coordinating all of this posed immense logistical problems for Plymouth president John Mansfield, but he insisted he would “much rather have the ones we have now than those we had a year ago.” Plymouth was indicative of the entire auto industry, which saw total production in mid-February approach two hundred thousand a week, a pace that would shatter previous annual records by nearly 25 percent. Auto boosters crowed.2
Although Detroit-area unemployment dropped by nearly half in early 1955, that still left eighty-five thousand people out of work. The MESC estimated that even with ramped-up vehicle output, the jobless total in the area would remain stuck at about seventy-five thousand for months. Working-class Detroiters understood this. All news reports claimed “that Detroit is having a big auto boom and that jobs are plentiful,” noted Edward Klien. “I have been unemployed since August, 1954, and cannot find a reliable job since the company where I worked folded up. I know the shops are working long hours, but they aren’t hiring any new help. There is plenty of unemployment in this country, even though the auto plants are busy.” Many of those still out of work were older residents who once had high-seniority union jobs at places like Hudson or on now canceled defense contracts. “I would like someone to tell me what a man 50 or over is to do to make a living for his family,” wrote an unemployed Detroiter. “I am 58, in good health and able to do a good day’s work. I have been out of work for nearly one year. I was a turret lathe operator but will take anything I can get. I have been everywhere I know or where I hear about hiring. But most places will not talk to an old man even if he gets past the outer office which is hard to do, believe me. I have seven years before I can get Social Security. What am I to do until then? Starve?” The unemployed had their critics, however. To the despondent, jobless, fifty-eight-year-old, a fellow Detroiter paraphrased the secretary of defense: “Are you a kennel or a hunting dog?” “I cannot believe it is impossible for these men to support their families,” proclaimed another disgusted Detroiter. “What in the world is the matter with some people? Are they lazy, ignorant or just too stupid to help themselves?”3
Despite similar surges in production, the 1955 boom differed from the previous one. In 1953 automakers had hired almost anyone available, including women and older Detroiters. They had also aggressively advertised around the country to fill vacant positions. In 1955 there was no out-of-state recruitment, and there remained a large reservoir of unemployed residents, even though total employment was at near record levels. Even the hundreds of thousands at work in auto plants had to wonder if their positions were secure. It was common for automakers to schedule more production in the first half of the year than in the second, but the pace in the early months of 1955 seemed especially torrid. Referring specifically to the annual competition between Ford and Chevrolet, UAW official Douglas Fraser remarked, “No matter which corporation wins the auto production race, auto workers are bound to lose.”4
With Big Three contracts expiring later in the year, UAW leaders suspected that automakers hoped to create a stockpile of unsold vehicles in case negotiations stalled, especially over the contentious guaranteed annual wage, which the union hoped would create greater stability for autoworkers. The UAW had long argued that auto production had been erratic and cyclical in large part because automakers believed production had to be highest in the first months of the year to prepare for the vaunted “spring selling season.” Every year, then, output in the second six months was automatically less than in the first half, so unemployment and short weeks were built into the auto production cycle before accounting for shortages, strikes, weather, model changeovers, and all the other factors that prevented steady work. If companies were forced to guarantee their workers a particular annual wage, UAW leaders reasoned, auto officials would find ways to maintain regular employment throughout the year, thereby minimizing production extremes. UAW leaders began planning for the GAW as soon as the 1950 contracts were signed, and in 1953 UAW research director Nat Weinberg had warned the American Management Association, whose members opposed the GAW as unworkable and quasi-socialist, that autoworkers would get the GAW “just as surely as they got pensions.” Automakers were by no means willing to concede, but strike-fighting inventories would have to be quite large. There were far more combinations of colors, styles, and options than in the past, which meant more models than ever needed to be displayed for potential customers. Although GM denied that production rates had anything to do with strike protection, Weinberg pointed out that by the industry’s own calculations its current rate of production would meet annual goals in just over eight months. What were workers supposed to do then? Fortune magazine concurred with Weinberg. “The major auto companies are still roaring down the straightaway in their fierce production race,” the business publication noted in March 1955, “but they will have to start applying the brakes soon,” because “the present production pace cannot be maintained much longer.”5
Whether or not the production boom was intended to be bargaining leverage, Big Three contract negotiations and the fate of the proposed GAW dominated local news. The UAW’s plan would work in conjunction with state unemployment systems. Each auto company would contribute money into a fund, managed jointly with the UAW, to supplement standard unemployment benefits and provide the equivalent of full-time pay for those on layoff. The long slide into recession during the second half of 1953 provided UAW leaders with a perfect example of why they thought the GAW was necessary. Autoworkers “don’t want to be paid for not working,” Reuther emphasized, “but they don’t want to be penalized for not having a job.” Ultimately, the UAW maintained, the GAW was really about guaranteed employment to ensure a guaranteed wage. The purpose of this stability, according to a sympathetic reporter, was to eliminate “the fear of being thrown out of a job on a moment’s notice, and never being sure, from one week to the next, where the rent and pork chop money is coming from. That is the greatest evil of the modern industrial system and nobody’s been able to lick it satisfactorily.”6
There was disagreement within the UAW, however, about whether the GAW was the best strategy to resolve the unemployment crisis. Carl Stellato, president of Local 600 at the Rouge plant, spoke for those who supported a thirty-hour work week with forty hours of pay as a better way to provide full employment. A shorter week would spread available work around to a larger number of people, but the plan would be viable only if it involved no loss in pay. Reuther and fellow GAW backers believed automakers and the larger public would strongly oppose a demand that called for ten hours of pay without commensurate time on the job, so to them, the “30-40 plan,” as it was nicknamed, was likely to amount to a 25 percent wage reduction. Although Reuther was irritated by internal opposition to the GAW, he acknowledged that the thirty-hour week had a measure of support when he added it to his list of priorities: “We’ve got to nail down the annual wage and then we will go after the short work week.”7
The GAW had plenty of wholehearted supporters. “We do not want any so-called pay for leisure, we want guaranteed employment year ’round,” commented one UAW member, who was tired of worrying “about shut-downs or lay-offs because orders have been caught up or the market is packed.” Edward E. Tennent, twenty-seven, who worked at Ternstedt, focused on the potential long-term significance of the GAW. “When you can count on steady work, you can plan ahead,” he said. “I’d rather have a guaranteed wage than a pay increase.” African American minister, activist, and columnist Horace White strongly objected to GAW critics who charged that workers were inherently lazy and had to be “prodded to produce.’” Such assumptions, White insisted, “show very clearly that there is a certain amount of snobbishness on the part of the opponents to the guaranteed annual wage. … The industrial worker wants the same kind of security and stability for his family that any other American wants. He will respond to this security with the same amount of integrity and honesty.”8
UAW arguments in favor of the GAW emphasized that the plan could help counter the impact of automation. Sensitive to accusations that they opposed progress, UAW leaders argued that they did not oppose future automation and did not want to turn back the clock on technological improvements. The GAW, they claimed, would stabilize purchasing power for the hundreds of thousands of autoworkers still likely to be necessary in the coming years, and without it, boom-and-bust cycles would intensify. To the UAW, then, the GAW was a matter of “social responsibility.” Local 174 member Charlie Buber agreed with that reasoning. “Big business, in the process of making these rapid revolutionary industrial changes, shows only concern for their profit and loss statements,” he wrote, and “does not concern itself about the social and economic chaos it creates.”9
Noting that GM’s Harlow Curtice had earned $686,000 in 1954, an hourly rate of $342, Walter Reuther appealed for a sense of fair play. “Management has two sets of moral and economic values,” he said. “One is for itself and the other is for the worker.” Such arguments prompted support for the GAW from the liberal National Religious and Labor Foundation. The more mainstream Methodist Church also supported the GAW. And early in the GAW campaign the UAW received a religious endorsement of sorts from Father Charles Coughlin, the famous 1930s radio preacher who first supported and then opposed the New Deal before undermining his career with anti-Semitic rants. Throughout the 1950s Coughlin remained the lead pastor at the Shrine of the Little Flower in Royal Oak, a suburb just north of Detroit. Apparently still a mesmerizing speaker, he received a long standing ovation from an overflow crowd after defending the GAW—and claiming credit for having come up with the idea during the Great Depression.10
Some rank-and-file UAW members, however, voiced concerns about the GAW. One warned that to keep workers busy, “the hard-earned lines of job demarcation will have to be eased, to permit men to be worked out of classification with the resultant discord as the working force is moved from car production to parts production during the slack season.” It was unclear how that would be worked out equitably and which wage would prevail when such shuffling took place. In addition, if a GAW plan truly replaced all of a jobless worker’s wages, there would be an inversion of the layoff and recall process. Traditionally, higher-seniority workers stayed on the job and those with less seniority were laid off, collecting unemployment benefits if eligible and resorting to secondary support systems. With the GAW, higher-seniority workers might prefer to be laid off first and receive full pay, leaving those with less time on the job to toil for their income. As one skeptical union member put it, the GAW would produce a “select class of people, who because of one day less seniority, can loaf and get paid while the rest of us have to work.” Others focused on the pragmatic question of whether it would be worth it to go on strike to obtain a GAW. Many Detroit autoworkers were still recovering from extended layoffs in 1954 and could hardly summon enthusiasm for another stretch without paychecks regardless of how they felt about the worthiness of the cause. Others favored the thirty-hour week: “I don’t think a guaranteed annual wage would create any more jobs,” said Keith Moore, thirty-four.11
Business leaders and boosters harshly criticized the GAW. As the U.S. Chamber of Commerce declared, “Security is sought at times at all costs, regardless of its resulting stultification and stagnation.” For the individual worker, the chamber argued, “the incentive to work would be lessened, and in some cases destroyed, and unemployment for some would be a desirable situation.” Frank Rising, the general manager of the Automotive Parts Manufacturers Association, emphasized that the GAW would provide incentives for companies to keep full-time employment at bare-bones levels, to subcontract jobs, and to schedule overtime rather than hire new personnel. National Association of Manufacturers official Charles Sligh Jr., stated boldly, “If companies accept the guaranteed wage plan as written, it will mean the end of America as we know it.” The Free Press also considered the GAW to be an abomination. The quest for income security, an editorial argued, invariably led down the slippery slope to totalitarianism: “Absolute job stability is like absolute security. It could only be had by rigid Government control of every man’s part and opportunity in the economic system. And it seems to us that nothing but complete Government control of the entire economy—including telling the citizen when he may buy and where he must buy—could make the guaranteed annual wage possible.” This was similar to the argument made by the Michigan Manufacturers Association, which called the GAW a “foreign, socialistic nightmare.” Ford’s John Bugas quipped that his company would support the GAW “if only somebody would come up with a good plan for GAP, or guaranteed annual profits.” Chrysler president L. L. Colbert emphasized that a GAW was only feasible in certain industries in which “the same number of products will be produced each year.” That might work for soap or laundry detergent, he suggested, but he did not think the automobile industry was “stabilized sufficiently to make accurate forecasts for the coming year, and regulate your production to these forecasts.” A company could store millions of bars of soap, he pointed out, but “you start talking about building and storing automobiles until you can sell them and you are talking about a different thing altogether”—which, ironically, was how many dealers, who bore the burden of overproduction, saw the current system.12
In the end, auto industry officials opposed the GAW because they knew their business was too volatile to guarantee anything like steady jobs for a whole year. The likelihood of stringing together consecutive years of full employment seemed like a fantasy. The UAW’s plan for guaranteed yearly wages was ultimately defensive, an attempt to create stability for its membership in a period marked by huge swings in employment and massive investment in automation. As one industry observer put it, “There have been so many job ‘crises’ in the State, that the citizens have learned to take them pretty much in stride. But familiarity has bred no great fondness for the wild fluctuations.” While auto executives claimed to empathize with their employees who suffered from this instability, they did so while trumpeting the marvels of competition in a free market economy. Autoworkers had ample opportunity to achieve stability, they insisted, with retraining or relocation.13
The positive aspects of a free market economy seemed apparent through the first half of 1955. By early May second shifts were common and unemployment in Detroit had dropped to forty-eight thousand, just 3.2 percent of the metro area’s workforce. Pontiac Motor produced more passenger cars by the second week of April than it had in all of 1954. Chrysler was also booming. The company earned more in the first two months of 1955 than it had in all of 1954 and produced nearly twice as many vehicles in the first quarter of 1955 than it had in the same period the previous year. That news overshadowed Plymouth’s announcement that it planned to increase production by 28 percent yet saw no need for additional hiring.14
L. J. Scott appreciated the good times. “Fifty-five was a boom year,” he recalled. “I bought me a ’55 Star Chief Pontiac. My second car. My first new one, though. Oh, I was feeling good. Things were looking my way, because in ’55 you could work all you wanted to. I worked a lot of overtime.” He was also single and saving on rent by living with family members, which made purchasing a new car possible. Thomas Nowak also benefited from the boom. After staying at Kaiser Motors until the bitter end, in 1955 he hired in at Ford’s Wayne plant, where he had recently worked on a construction crew. Unsure about the stability of auto employment, he hedged his bets by taking a second job handling baggage and cleaning planes for American Airlines at the Willow Run airport. With three children and a fourth on the way, he explained, “I had to hustle.” He worked days at the airport and evenings at the Mercury plant, with forty-five minutes between shifts to drive the ten miles from Willow Run to Wayne. Nowak rarely saw his family, and he eventually exhausted himself. “I run off the road a couple of times,” he recalled. So he quit the airline job after three and a half months. The Mercury job paid more and he liked it better. In addition, after his eight hours on the assembly line, he often worked overtime, using his skills as a repairman. “That’s where I was making a lot of my money for my house,” he noted. After missing the 1954 recession while in the military, Joe Woods returned to Pontiac Motor in 1955 and was allowed to run a production job on the engine block line that, before he left for Korea, would have been off limits to a black man. The thrill wore off quickly, however, even though he liked the steady pay. “All I was doing was checking the bore numbers and sizes, make sure everything was correct,” he recalled. “You could just sit up there and go to sleep.” Elwin Brown definitely valued the relative stability at Pontiac Motor in early 1955. His pregnant wife, Mary, had decided to stay behind in her hometown of Evansville, Indiana, when he was recalled near the beginning of the production upturn. The unpredictability of auto work and the lack of a family support network in Pontiac had made her reluctant to leave, but boom conditions eventually convinced her to join her husband. The upturn also allowed James Franklin to have no regrets about leaving his job in Flint to be back with his family in Ypsilanti, because he was quickly rehired at the Rouge, where he had worked twice before. Edith Arnold missed the 1955 boom as she recovered from surgery, but Margaret Beaudry, Katie Neumann, and Dorothy Sackle had all the work they wanted. Paul Ross found ways to make more than his wages from auto work during these times. “What I did is run a check pool,” he said. “Everybody gets a check once a week, and you had a number on it.” Players in the pool would pick their best five numbers as if they were a hand of cards. “Everybody that wanted to play, they’d pay a dollar, and whoever got the best poker hand won the money,” minus Ross’s cut. “I made my car payments and stuff on that,” he remembered.15
Automakers emphasized these bountiful times when warning of the dangers of strikes over new contracts. “We believe our employes are just as eager as we are for the continuation of what has been a generally happy and profitable period,” Henry Ford II claimed. “We wish we could be sure that all union leaders feel the same way.” Ford was especially concerned because if the UAW held out for the GAW, his company would most likely be the strike target. Since Ford had only about a third as many employees nationwide as GM, fewer union members would need relief. It also did not make sense for the UAW to focus strike preparations on Chrysler, even though that company was also much smaller than GM, because its contract expired a few months after Ford’s and GM’s. Eager to maintain uninterrupted production but not prepared to concede on the GAW, Ford offered to allow union members to purchase company stock at half price when the privately traded automaker went public, which it was scheduled to do in the near future.16
UAW officials criticized the stock plan, as did rank-and-filer Michael Turfe, twenty-five. “I’ve never worked a full year yet,” Turfe said. “If a man is going to be laid off for a month or two, how can he afford to buy stock, no matter what the price, or get ahead at all?” “We could not buy any stock in the company,” insisted the wife of a Ford worker. “We have three children.”17 A Ford stamping plant worker’s wife showed exactly how her husband’s pay of $4,582.28 had been spent the previous year:
| Telephone | $ 78.53 |
| Gas (including heating for six months) | 119.03 |
| Oil (six months) | 69.21 |
| Water (six months) | 15.78 |
| Car insurance | 63.00 |
| Rent and house payments | 870.00 |
| Washing machine | 60.00 |
| Interest | 44.00 |
| Union dues | 30.00 |
| Insurance for children | 80.48 |
| Blue Cross (surgical, no medical) | 70.00 |
| FICA and Income Tax | 415.62 |
| Husband’s insurance | 41.68 |
| Doctor bills, X-rays, medicine, etc. | 528.00 |
| Milk | 175.00 |
| Church and contributions | 200.00 |
| Food ($25 week) | 1,300.00 |
| Screens and storm doors | 42.00 |
| Husband’s transportation to work | 120.00 |
| Total | $4,421.93 |
“That leaves $180.35,” she calculated. Yard work ate up some of that total, as did shoes for their two daughters, ages ten and eleven. Their car, used sparingly, still burned fifty dollars in gasoline for the year. In the end, forty dollars for the year was available for clothes for the children and family entertainment. “Will you please tell me what we are going to use to buy stock with?” she asked. According to a tax preparer, who had helped hundreds of Ford workers with their returns, “Not one family—where the wage earner was under 45 years old, had any funds for investment. Practically all had a ‘hefty’ portfolio of mortgages on everything that could be mortgaged,” he explained. “If a man hasn’t the money to take advantage of the offer then the opportunity does not actually exist for him.” Compared with Chrysler employees, Ford workers had experienced a bonanza year in 1954, but even with relative prosperity—and what appeared to be full employment at the stamping plant—a stock plan made no sense. On the eve of the strike deadline, the UAW proposed a binding secret ballot of Ford workers: rank-and-file union members would settle the issue by choosing either the company’s stock option plan or the GAW. Ford backed down and the deadline passed without a formal walkout, although wildcat strikes erupted throughout the company’s plants.18
For all the controversy over the GAW, the outcome of negotiations seemed anticlimactic. Shortly before a revised strike deadline—a few days after the original one—Ford and the UAW reached an agreement on a three-year contract. On the biggest issue, the GAW, the two sides settled on what was essentially an improvement in unemployment benefits. The company agreed to contribute toward a fund that would eventually supplement what workers already qualified for through state-run unemployment compensation programs. The existing state system in Michigan provided from roughly a third to just under half of take-home pay, depending on a worker’s specific job and number of dependents. With the new supplemental unemployment benefit, a laid-off worker would be eligible to receive 65 percent of take-home pay for the first four weeks of idleness and 60 percent for an additional twenty-two weeks, both far short of the UAW’s ultimate goal of 100 percent for a full year. Since employers also funded the state unemployment programs, in effect Ford would pay for the entire benefit package, with one check coming from the state government and the other directly from the company. Backing off on years of declarations that no contract would be signed without a full-fledged GAW, Walter Reuther called it a “good agreement” that “provides the principle upon which we are going to build the guaranteed annual wage.” Although just a beginning, he emphasized, SUB would “provide workers and their families a greater measure of security against the hardships and hazards of unemployment.”19
Ford officials also spun the compromise as a victory. As a company spokesman explained, downturns in the industry were so frequent that something had to be done, but the company wanted to be sure that any plan included “enough differential between the man who is working and the laid-off worker so that the man on the job would not feel discriminated against.” In addition, total unemployment pay for any worker had to “be low enough to provide him with an incentive to look for another job in the event of a long lay-off.” The company thought that it had hit that sweet spot with the 60–65 percent mark, insisting that “its greatest responsibility to its employes is for the short-term layoff.” At a cost to the company of five cents per hour per employee, a fund of $55 million would be built up over several years. Depending on the frequency and duration of layoffs, that sum might or might not be adequate. “There is no such thing as a complete guarantee,” the company emphasized.20
Most business leaders and industry boosters harshly criticized the settlement, with some charging that Ford officials had gone insane. NAM’s Henry Riter was livid, insisting that by giving in on the GAW even a little bit, Ford had steered the nation down a road “leading to a socialistic state and controlled economy.” Free Press editors largely shared this view, although they breathed a sigh of relief that the UAW’s full GAW proposal, which they termed “a thing of unlimited dangers,” was defeated. “The question is whether once the start is made in such a revolutionary direction these safeguards and limitations can be maintained.” Syndicated business columnist Sylvia Porter warned readers that the UAW-Ford settlement, “in one of the most violently seasonal of industries,” meant “the increasing probability that over the long term, our cost of living is going up and the buying power of your dollar is going down.” Most economists seemed to think that the SUB compromise would contribute to what was becoming known as the “Century of Inflation.” Many auto industry analysts agreed, arguing that the only way now for carmakers to keep a lid on prices was through increased automation. As one expert noted, “Lower production costs will have to be achieved to keep retail prices from higher rises.” University of Michigan economist Paul McCracken, however, did not share the dire views. “This does not sound the death knell of the free enterprise system,” he argued. In effect, he explained, Ford would divert about $50 million of potential purchasing power into its SUB fund to be released as actual spending when the economy needed it most.21
Plenty of Ford workers had negative reactions to the agreement, especially at the Rouge plant, where support had been strong for the 30–40 plan. “If some of you would keep quiet I could explain these things to you,” Local 600 president Carl Stellato snapped at hundreds of Rouge workers who had gathered to hear the settlement terms. “You don’t boo things that give you security.” Stellato was aware that Ford had refused even to discuss the 30-40 plan. Indeed, at a post-agreement news conference, personnel director John Bugas laughed at the thought of the thirty-hour week. Nevertheless, many low-seniority workers remained skeptical that the new SUB provisions would be enough to help them weather economic downturns. Skilled workers were the most vocal opponents of the new contract. Traditionally they had been relatively protected from layoffs and were therefore the least likely to benefit from SUB. “The union promised the skilled workers a 30-cent package increase and then backed down and settled for much less,” complained Ignie Mitskavich, a toolmaker. As Mitskavich noted, the SUB plan did nothing to address wage compression that continued to reduce the economic advantage of belonging to the trades. A skilled maintenance worker at the Rouge accused union negotiators of selling tradesmen “down the river for nothing.”22
Some of the complexities of the contract settlement could be found in the case of Jim Covert, fifty-five, who lived in Dearborn and had worked at the Rouge plant for thirty-three years. In 1955 he was a final inspector on a motor assembly line and stood to earn about $4,700 if he worked full-time. His job was to check the width of a particular hole in connecting rods as they passed by him. His gauge would read red, yellow, or blue, and he marked each rod accordingly, about three thousand times a day. He agreed that his task got “a little monotonous—you begin to see connecting rods in your sleep.” But at least it did not involve much physical exertion, something his doctor had told him to avoid after a heart attack three years earlier. There was no possibility of going back to his previous job, lifting sixty-pound crankshafts twenty-five hundred times a day. Covert had a wife and two adult sons. They had purchased their home during World War II and paid far less on their mortgage in 1955 than they would have had to pay in rent for an apartment. Covert had favored the thirty-hour week and full pensions at fifty-five, precisely his age. The new SUB plan did not interest him. “With my seniority,” he explained, “I haven’t been laid off at all since 1948.” SUB might have been better suited for his two sons. Charles, twenty-three, had worked in a Ford glass plant but gave up on auto work after being laid off for two months. Donald, twenty-two, had recently been laid off for six weeks and calculated that the new SUB pay would have given him only an extra $4.25 for the first four weeks and $1.00 for each additional week of his time off. “He’s not impressed,” Covert said. Whether or not Covert was typical of Ford workers, his story showed that in 1955 only the highest-seniority Ford workers seemed to have experienced any job stability in recent years and that there was much skepticism about SUB.23
Workers like Jim Covert were what intellectuals had in mind when they analyzed the new “labor aristocracy.” “Its founders are the United Auto Workers,” proclaimed Sylvia Porter. “Its heart lies in Detroit—and its elite are those who work for the auto giants.” If you were in this group, the argument went, you were among the highest-paid industrial workers in the country, you could receive a pension when you retired, you only had to pay half the premium for hospitalization and surgery costs, you had a cost-of-living clause to protect you against inflation, you got a paid vacation, and with the new contract, you received triple-time pay for working on national holidays. You enjoyed all of that, plus you now had added economic protection in case of layoffs. All of that was technically true. “Our workers certainly are in a preferred position in the country,” bragged a Ford official when asked how his company’s benefits compared with those of other employers. “We’re about tops in the country,” agreed a UAW spokesman. “And we haven’t stopped yet.” Fortune magazine gushed about the rise of the “Detroit middle class,” calling it “one of the most quiet and orderly overthrowings of an old established order possible to imagine.”24
But this comparison with the mass of nonunion workers in the country, and even with most who were unionized, did not accurately depict the experiences of the vast majority of autoworkers since World War II, few of whom would have considered themselves to have lived the lives of the elite. Even the most aristocratic members of the UAW, the skilled tradesmen, were hopping mad in 1955. Few unskilled workers had received anything resembling steady work since the war, which undercut the significance of high hourly wages. Indeed, many had only begun auto work in 1953 and then were promptly laid off, often for an entire year. Medical expenses still bankrupted working-class families. The cost-of-living clause seemed to trigger higher prices even though it was supposed to account for existing inflation. Moreover, relatively few of the hundreds of thousands of autoworkers had been able to retire, and those who received pensions generally found them inadequate, especially with high inflation. This became apparent to Ford officials, somewhat embarrassingly, when they summoned the press to cover a celebration for their ten-thousandth retiree, Jim Wolfe, sixty-five, who had worked at the company for over thirty years. He and his wife, Annie, could expect pension and Social Security benefits totaling $151 a month, less than half of what he had earned before retirement. “It is going to be a tight squeeze,” Wolfe told the audience, which included Ford executives, top UAW officials, and local media teams assembled in his front yard. “But my oldest boy, Jim, 37, has a concrete business and maybe I can help him out.” Wolfe, who had never owned a car, told the gathering that he was “ashamed of my house. That’s the real reason I retired. … It’s a frame house, and you know what happens when you let them go for a while. I’ve been working afternoons for seven or eight years now, and that kind of a job is all bed and work. You never have time for anything around the house.”25
Skilled workers at GM, the peak of any “labor aristocracy,” observed the settlement at Ford and wanted none of it. They staged wildcat strikes while their contract negotiations were under way, resulting in ten thousand layoffs in Detroit and sixty thousand nationwide. “We’re always the last to be laid off anyway,” explained Harold Frye, spokesman for a group of striking skilled workers in Flint. “We’d rather have more money and have some other problems straightened out than agree to the same thing the union got from Ford.” For many skilled workers it made sense to form their own locals, separate from the unskilled and semiskilled, a reversal of the 1930s-era “industrial union” approach, which maintained that for maximum leverage the entire workforce should belong to the same bargaining unit. “We feel that’s the only way we can get real representation,” Frye insisted. Yet just three days after the GM skilled-worker wildcat wave, the company and the UAW reached an agreement almost identical to the one signed by the union and Ford.26
Business boosters were generally appalled. “The magnitude of what’s just happened in Detroit is beyond the mental reach of any man to comprehend,” declared the Free Press. Reuther was able “TO KICK IN THE DOOR TOWARD GAW AT FORD—AND THEN WALK RIGHT INTO THE ROOM UNHINDERED AT GM.” Business leaders feared “that Big Labor might be able to push those limits up near the Utopian Reuther goal of paying a man as much for not working as for working.” Industry analyst Stanley Rector warned that 1955 would be seen “as the year Reuther performed a hysterectomy on the goose that laid the golden eggs.” Regaining his equilibrium a few days later, Free Press publisher John S. Knight conceded that the UAW was “right in saying the new contracts will give the auto makers more incentive to schedule manpower and production more evenly. The factory worker will become a better credit risk, buy a little more from downtown stores on time, splurge a little more on recreation and vacations. Steadily, but surely, his personal economic roller-coaster will flatten out. The ride will be less thrilling. But more satisfying.” Perhaps Knight accepted the UAW’s calculation that the full-fledged GAW would have added only twelve dollars to the cost of a new car, or 4 percent on the average of three hundred dollars’ worth of labor that went, into each vehicle.27
For all the debate concerning the new SUB plan, over 134,000 GM workers struck the first day under their new contract to protest the lack of progress on resolving local issues. Pontiac Motor, for example, was completely shut down because of disagreements over time schedules and working conditions. This resulted in layoffs at the Fisher Body facility in Pontiac, a main supplier. UAW officials pleaded with members to stay on the job, with some success, but four days later over 65,000 GM workers, including thousands at Detroit’s Fleetwood and Fisher Body plants, were still at home because of strikes and resulting parts shortages. Workers at the Fleetwood plant made a number of demands, including the reinstatement of morning and afternoon coffee breaks, something the relentless production pace no longer allowed. Cleanliness was also an issue. “I have to lie and cheat every time I want to wash my hands,” insisted welder George Selby. “I don’t think a man should have to crawl to his foreman for permission to do that.” Women workers complained about filthy conditions and demanded that GM provide them with gloves. In addition, a number of union members wanted smoking areas and more convenient locations for time clocks.28
With Chrysler negotiations looming, warning signs indicated that the auto boom had passed its peak. Automakers had already ratcheted back output, most likely, as UAW officials had predicted, because of the breakneck pace during the year’s first quarter. If the industry’s annual production forecasts were still accurate, the boom from January to March portended as much as a 40 percent reduction during the second half of the year, significantly larger than the customary target of a 10 percent differential. Overtime hours began to disappear, and unemployment crept upward with the elimination of many second-shift operations. In May the number of unsold cars nationwide reached a record 840,000, almost a quarter of a million above the previous high. Huge inventories alone were not necessarily critical, because they could be reduced quickly with strong sales. But as purchases declined, dealers became desperate, and now familiar accusations of bootlegging flew in every direction.29 To unload 1955 models before the 1956 lines were introduced, some dealers offered incentives like television sets, mink coats, washing machines, refrigerators, trips to Paris, or shares of stock in uranium companies, while others used hard-nosed and duplicitous tactics to get consumers to buy. Debt had fueled the boom, and some economists argued that the nation’s prosperity was all a credit bubble waiting to burst. Altogether, auto loans had increased in June by $576 million to an all-time high of $12.5 billion, amounting to half of all the country’s installment credit. In August the General Motors Acceptance Corporation (GMAC), the company’s car loan division, sent stern warnings to its 18,500 dealers to stop offering “easy credit.” Too many purchasers, the GMAC said, were paying more than “they could comfortably afford.” In addition, with long repayment periods offered by dealers, there was greater likelihood that the amount owed on vehicles would be greater than their market values, a condition ripe for repossessions. The National Automobile Dealers Association did not mince words, telling its 32,000 members “to put a stop to crazy credit and start back on the road to sanity.”30
As concerns increased in the auto industry, the Eisenhower administration declared 1955 to be the “biggest ever” for prosperity in America. Detroit headlines concurred, with one declaring in early July that 1955 had already qualified as “The Best Year in All History.” Until that point unemployment rates had been low, inflation appeared to be under control, and income and production totals were at all-time highs. Economic experts also offered rosy interpretations of recent history. Government spokespeople asserted that Americans’ personal incomes had “never stopped rising,” even during the year and a half of recession that began in mid-1953. Moreover, the U.S. Department of Commerce claimed that the 1954 downturn was not as bad as it had previously thought. Total economic activity, the government agency announced, had dropped only about 1 percent from 1953 to 1954, which to economists meant the recession had made little impact on the country. For some Detroiters, these statistics made sense and outweighed any concerns about the future. Automakers had produced a record number of cars during the first half of 1955, surpassing some post–World War II annual totals. GM’s success was increasingly important to Detroit autoworkers, because the largest carmaker had greatly expanded facilities and employment in the area. Counting its Pontiac and Willow Run operations, GM had nearly 73,000 workers in metro Detroit in mid-1955, nearly double its total from five years earlier. Total industrial payrolls in Detroit reached all-time highs in 1955, even though total employment remained 10 percent below that in 1953. Largely because of fringe benefit costs—for unemployment benefits, medical insurance, and pensions—auto companies preferred offering overtime hours to its existing workforce, by operating on six days a week or for more than eight hours a day, before hiring new employees. But there were still an estimated 683,000 manufacturing workers in metro Detroit, and they provided much of the purchasing power that sustained the area’s 638,000 nonmanufacturing employees.31
Since these conditions could easily be considered the foundation for a continuing boom, from Chrysler’s perspective it made sense to reach an agreement with the UAW and not risk a profit-wrecking strike. Chrysler had done far worse than Ford and GM during the 1954 recession, by its own admission because of “stodgy” car designs that no longer appealed to consumers. The company had also begun an aggressive, long-term process of expansion and retooling, including the introduction of state-of-the art automation in many plants. Business observers gave much of the credit for Chrysler’s comeback in 1955 to its president, L. L. “Tex” Colbert, who had gained his reputation managing Dodge’s B-29 aircraft manufacturing in Chicago during World War II. After the 1954 debacle, Colbert pledged to regain lost market share. Through the first eight months of 1955 he kept his promise, as Chrysler met its goal of 20 percent of domestic auto sales. A strike could undercut this progress. Autoworkers at Chrysler were no less eager to avoid a shutdown, and the two sides settled in the middle of the night on September 1. The contract’s SUB provision was essentially the same as Ford’s and GM’s, and skilled workers received the same wage increase that had provoked anger earlier that summer. Shortly after the Chrysler settlement, American Motors and most remaining major parts suppliers, including Kelsey-Hayes, Budd, Borg-Warner, and Eaton, also signed contracts that included SUB clauses.32
In many ways, including unprecedented production, record numbers of workers, high wages, overtime, and contract improvements like SUB, 1955 is the reason why so many people have looked on the fifties as a prosperous decade for autoworkers. End-of-year production figures confirmed this assessment. Nearly 8,000,000 passenger cars were produced. Adding trucks, the total reached 9,190,692. General Motors set new vehicle assembly records. Chrysler reported record production and sales, as well as a 440 percent increase in profits over 1954. Ford’s output, sales, and profits were its highest ever, and for the first time the company’s total payroll topped a billion dollars. Across metro Detroit, the addition of second and sometimes third shifts boosted the total number of autoworkers despite the long-term trends of decentralization and automation. Aggregate income for Detroiters and the volume of local shopping made statisticians forget the previous year and a half of recession. 33 Along with a few months in both 1950 and 1953, 1955 was the 1950s as many have come to understand the decade.
Yet there were problems with this glowing assessment of the industry’s performance. A number of skilled tradesmen, perhaps 20,000 of the roughly 300,000 skilled UAW members (out of a total union membership of some 1.5 million), formed a secession organization, the Society of Skilled Trades, as they continued to protest what they called “discrimination” against them in contract negotiations. The union could not afford to lose these critical members, and automakers feared that if tradesmen struck, they could prevent the timely introduction of 1956 models.34 African American autoworkers, who surely saw the irony of skilled workers complaining of discrimination, observed that automation had eliminated many of the materials-handling jobs traditionally reserved for them even while some new opportunities had arisen, especially early in the boom. Women continued to have difficulty breaking into auto work. Of the 391,000 working women in Wayne, Macomb, and Oakland counties in mid-1955, only 34,000 had jobs in auto manufacturing. The frustration for some women who tried to be autoworkers was lessened a bit because the auto-wage-fueled prosperity created thousands of clerical and secretarial jobs and drove wages upward as businesses struggled to fill those positions. At one point an experienced secretary who typed sixty words a minute could earn almost as much as an unskilled autoworker, without the noise, grime, and potential dangers.35 No matter the sector of the economy, future prosperity in Detroit depended mainly on the auto industry, and layoff totals crept upward in the last half of the year, as did unsold dealer inventories. Unemployment increased more quickly during the holiday season, prompting harsh criticism from affected workers, who wondered whether this was a minor blip or an indication of worse to come.36